TSMC Projects 29% Revenue Growth in 2025 Driven by AI Chip Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2h ago
0mins
Source: Fool
- Market Share Leadership: As of Q3 2024, TSMC holds a commanding 72% revenue market share in the global foundry market, significantly outpacing Samsung's 7%, which underscores its dominant position amid surging AI chip demand and solidifies its industry leadership.
- Robust Customer Demand: Nvidia's $500 billion order backlog is expected to drive TSMC's business growth, with projections indicating nearly 29% average annual earnings growth over the next few years, highlighting the company's critical role in the AI investment cycle.
- Technological Innovation Edge: TSMC is manufacturing chips for Nvidia's upcoming Rubin architecture using its advanced 3-nanometer process, which will enhance performance while reducing power consumption, further strengthening its competitive position in the high-end chip market.
- Attractive Valuation: With a price-to-earnings ratio nearing 30, TSMC appears expensive, yet its PEG ratio of approximately 1 indicates it remains attractive at current prices, suggesting investors can expect strong long-term returns.
Analyst Views on TSM
Wall Street analysts forecast TSM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for TSM is 348.25 USD with a low forecast of 290.00 USD and a high forecast of 400.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
9 Analyst Rating
8 Buy
1 Hold
0 Sell
Strong Buy
Current: 299.580
Low
290.00
Averages
348.25
High
400.00
Current: 299.580
Low
290.00
Averages
348.25
High
400.00
About TSM
Taiwan Semiconductor Manufacturing Co Ltd is a Taiwan-based company mainly engaged in the provision of integrated circuit manufacturing services. The integrated circuit manufacturing services include process technology, special process technology, design ecosystem support, mask technology, 3DFabricTM advanced packaging and silicon stacking technology services. The Company has completed the transfer and mass production of 5nm technology, and is engaged in the research and development of 3nm process technology and 2nm process technology. The product application range covers the entire electronic application industry, including personal computers and peripheral products, information application products, wired and wireless communication system products, servers and data centers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
