In the latest trading session, TSMC (TSM) closed at $222.74, marking a +1.2% move from the previous day. Elsewhere, the Dow lost 0.25%, while the tech-heavy Nasdaq added 0.31%.
Shares of the chip company witnessed a gain of 11.34% over the previous month, beating the performance of the Computer and Technology sector with its gain of 7.62%, and the S&P 500's gain of 5.05%.
The investment community will be closely monitoring the performance of TSMC in its forthcoming earnings report. It is anticipated that the company will report an EPS of $2.32, marking a 56.76% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $30.05 billion, up 44.32% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $9.28 per share and revenue of $116.93 billion, indicating changes of +31.82% and +29.8%, respectively, compared to the previous year.
It's also important for investors to be aware of any recent modifications to analyst estimates for TSMC. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.94% increase. At present, TSMC boasts a Zacks Rank of #3 (Hold).
Looking at its valuation, TSMC is holding a Forward P/E ratio of 23.73. For comparison, its industry has an average Forward P/E of 23.73, which means TSMC is trading at no noticeable deviation to the group.
It is also worth noting that TSM currently has a PEG ratio of 1.14. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Semiconductor - Circuit Foundry industry stood at 1.14 at the close of the market yesterday.
The Semiconductor - Circuit Foundry industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 96, putting it in the top 40% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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Taiwan Semiconductor Manufacturing Company Ltd. (TSM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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