TSMC's Market Value Has Evaporated About $100billion This Year: Analysts Collectively Shouted "wrong Kill"

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Although TSMC's market value has evaporated about $100billion due to the sharp decline in its share price this year, there are still not a few analysts optimistic about the stock. They are unmoved by market fluctuations. According to the data, as the macroeconomic impact on the chip industry eases and investors start to pay attention to the fundamentals of TSMC again, the seller's analysts expect the company's share price to rise by about 50% in the next 12 months, reaching a record high.

Fund managers also believe that the stock is expected to hit the bottom. Recently, Liu Deyin, chairman of TSMC, also predicted that the company's revenue would increase by 30% this year, thus promoting market expectations.

Although TSMC's decline is indeed large, with more than one tenth of the market value evaporated, it is still only half of the overall decline of the global semiconductor index in 2022. The company occupies a strong position in the global technology supply chain, and is Apple To NVIDIA and other major technology giants to manufacture the most advanced chips.

Alex Huang, manager of capital hi tech fund, said: "once non fundamental factors dissipate, buyers will return immediately." He believes that although inflation concerns and the conflict between Russia and Ukraine have put pressure on the semiconductor industry, these two factors are expected to improve in the second half of this year.

As a stock with the largest market capitalization and strong liquidity in Taiwan, China stock market, TSMC will also become the preferred selling target for many foreign investors. This company with a market value of $475billion accounts for about 27% of the market value of the entire Taiwan stock market.

Sanford C Bernstein, an analyst, wrote earlier this month: "although many people are worried about cyclical adjustments, we still expect TSMC's share price to rise and its pricing is very strong, which will ensure the company's uninterrupted growth this year and in 2023 and 2024."

Among the 37 analysts who included TSMC in the research scope, 34 recommended "buy", 3 recommended "hold", and no one recommended "sell". Analysts' 12-month average target share price of TSMC was NT $816.75, while TSMC's closing price on Thursday was only NT $541.

Risk factors

What needs to be clear is that investors have indeed been hit by the epidemic, missed many dangerous signals before the outbreak of the conflict between Russia and Ukraine, and have differences on inflation - all these factors will continue to affect the macro situation of chip manufacturers.

"We believe that TSMC's share price has reflected the economic downturn." JPMorgan Chase analysts wrote in Wednesday's research report, "but the potential downward range in 2023 is still unknown." Nevertheless, they still maintain the "buy" rating of the stock.

Other analysts were less hesitant than JPMorgan when recommending the stock.

Morgan Stanley analysts said in the research report that the existing market tension is a good opportunity to buy TSMC. The company "has a safe future".

"We think this is a good time to increase our positions." They specially mentioned the leading position of the company in the technology industry in the Research Report at the end of last month.

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