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TSMC (TSM) closed at $208.37 in the latest trading session, marking a +0.6% move from the prior day. This move outpaced the S&P 500's daily loss of 1.54%. At the same time, the Dow lost 1.63%, and the tech-heavy Nasdaq lost 1.63%.
The chip company's stock has climbed by 8.18% in the past month, exceeding the Computer and Technology sector's gain of 0.11% and the S&P 500's loss of 2.2%.
Investors will be eagerly watching for the performance of TSMC in its upcoming earnings disclosure. On that day, TSMC is projected to report earnings of $2.16 per share, which would represent year-over-year growth of 50%. Meanwhile, the latest consensus estimate predicts the revenue to be $26.38 billion, indicating a 34.43% increase compared to the same quarter of the previous year.
It is also important to note the recent changes to analyst estimates for TSMC. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.36% lower. TSMC is holding a Zacks Rank of #3 (Hold) right now.
From a valuation perspective, TSMC is currently exchanging hands at a Forward P/E ratio of 23.5. Its industry sports an average Forward P/E of 23.5, so one might conclude that TSMC is trading at no noticeable deviation comparatively.
It is also worth noting that TSM currently has a PEG ratio of 0.75. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Semiconductor - Circuit Foundry industry stood at 0.75 at the close of the market yesterday.
The Semiconductor - Circuit Foundry industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 91, placing it within the top 37% of over 250 industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.