TSMC (TSM) ended the recent trading session at $426.80, demonstrating a +2.8% change from the preceding day’s closing price. This change outpaced the S&P 500’s 0.3% gain on the day. Meanwhile, the Dow lost 0.16%, and the Nasdaq, a tech-heavy index, added 0.86%.
The chip company’s stock has climbed by 0.85% in the past month, falling short of the Computer and Technology sector’s gain of 3.7% and the S&P 500’s gain of 1.92%.
The investment community will be closely monitoring the performance of TSMC in its forthcoming earnings report. On that day, TSMC is projected to report earnings of $3.69 per share, which would represent year-over-year growth of 49.39%. Simultaneously, our latest consensus estimate expects the revenue to be $39.76 billion, showing a 32.23% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $15.29 per share and a revenue of $161.84 billion, demonstrating changes of +43.57% and +32.19%, respectively, from the preceding year.
Investors should also pay attention to any latest changes in analyst estimates for TSMC. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.29% higher. Currently, TSMC is carrying a Zacks Rank of #3 (Hold).
In the context of valuation, TSMC is at present trading with a Forward P/E ratio of 27.15. This valuation marks no noticeable deviation compared to its industry average Forward P/E of 27.15.
We can also see that TSM currently has a PEG ratio of 1.21. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Semiconductor – Circuit Foundry industry currently had an average PEG ratio of 1.21 as of yesterday’s close.
The Semiconductor – Circuit Foundry industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 109, this industry ranks in the top 45% of all industries, numbering over 250.
