Taiwan Semiconductor Manufacturing: Buy During Market Dip

Taiwan Semiconductor Manufacturing, or TSMC, stands out as a must-buy stock for long-term investors amidst a market sell-off, now down over 20% from recent highs. The company's leadership in chip manufacturing and strong revenue growth offers a prime investment opportunity.

Date: 15-03-2025

AI Rating: 7

Earnings Per Share (EPS): The report does not provide specific EPS figures, making it impossible to assess this metric.

Revenue Growth: TSMC has reported a revenue growth rate of 37% in U.S. dollars and 39% in local currency for the last quarter, indicating a robust demand for its services. This growth has continued into the first quarter, with revenue growth of 36% in January and 43% in February, both measured in local currency.

Net Income: The company's net income rose by 57% in local currency in Q4, showcasing a strong profitability trajectory.

Profit Margins: The company signals an increase in its gross margin due to pricing power from TSMC's advanced technology leadership and its plan to raise prices this year. However, specific profit margin percentages are not explicitly stated in the report.

Free Cash Flow (FCF): Free cash flow is not discussed in the report, limiting the analysis of operational cash generation.

Return on Equity (ROE): The report does not contain information regarding the company's return on equity, which makes it difficult to evaluate this important performance metric.

Overall, TSMC is well-positioned in the semiconductor industry, benefitting from increasing AI infrastructure spending and strong partnerships with major customers like Nvidia and Apple. The attractive valuation at a forward P/E ratio of 19.5, alongside the rapid revenue and net income growth, suggests that TSMC is a viable investment option during this sell-off.

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