TSMC Stock Hits NT,000 Apiece as AI-Powered Rally Prevails

TSMC Stock Hits NT$1,000 Apiece as AI-Powered Rally Prevails

News Agencies July 4, 2024

(Bloomberg) — Shares of Taiwan Semiconductor Manufacturing Co. rose above NT$1,000 a share as the rally fueled by artificial intelligence optimism continues before its earnings.

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The stock closed up 2.7% to a record high in Taipei, extending its run this year to nearly 70%. The advance comes as the world’s largest chip maker is expected to report strong earnings in results due this month, thanks to booming AI demand.

Its market value based on the American depositary receipts recently surpassed Berkshire Hathaway Inc. to become the eighth-largest company globally, and is close to hit a market cap of $1 trillion. While TSMC’s cutting-edge technology and valuation are making it a favorite play among global investors, the company has also benefited from being the main advanced-chip supplier of Nvidia Corp.

TSMC is expected to post a 36% growth in the second-quarter revenue, from a year earlier, the fastest pace since the last quarter of 2022, according to a Bloomberg poll of 29 analysts. Bloomberg Intelligence expects the company’s revenue to beat market consensus by 10%, leading a batch of earnings’ surprises in Taiwan’s foundry sector.

UBS this week raised its full-year capital expenditure estimates for TSMC, citing increasing demand from generative AI and recovering margins on the back of cutting-edge technology. Meanwhile, Apple Inc.’s potential adoption of the company’s chip-stacking products also boosted sentiment.