TSM Should I Buy
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Based on the investor's beginner knowledge level, long-term investment preference, and the strong financial performance of TSMC, the stock is a good buy. Despite the current price dip, the company's robust growth in AI-related revenue, strong analyst ratings, and positive long-term outlook make it a solid choice for long-term investment.
The MACD is negatively expanding with a histogram of -4.571, indicating bearish momentum. RSI is at 26.003, suggesting the stock is nearing oversold territory. The current price is below the pivot level of 366.336, with key support at 336.298. This indicates a potential buying opportunity for long-term investors.
TSMC is projected to achieve over 50% annual growth in AI revenue and holds a near-monopoly in advanced logic chip manufacturing. Analysts have consistently raised price targets, citing strong demand for advanced nodes and AI-related growth. The company achieved a 25.52% YoY revenue increase and a 40.66% YoY net income increase in Q4 2025.
The stock is currently experiencing a price decline (-4.20% in regular market and -2.93% in pre-market). Additionally, options data indicates bearish short-term sentiment.
In Q4 2025, TSMC reported a revenue increase of 25.52% YoY to $33.1 billion, net income growth of 40.66% YoY to $16.3 billion, and EPS growth of 40% YoY. Gross margin improved to 62.32%, up 5.63% YoY, demonstrating strong profitability and operational efficiency.
Analysts are highly bullish on TSMC. DA Davidson initiated coverage with a Buy rating and a $450 price target, citing a 'compounding execution moat.' Barclays raised its price target to $450, and Goldman Sachs highlighted TSMC's multi-year growth engine in AI, raising its price target to NT$2,330.
