TSMC (TSM) Gains But Lags Market: What You Should Know
In the latest trading session, TSMC (TSM) closed at $90.04, marking a +0.64% move from the previous day. The stock lagged the S&P 500's daily gain of 0.89%. At the same time, the Dow added 1.2%, and the tech-heavy Nasdaq lost 0.68%.
Coming into today, shares of the chip company had lost 0.7% in the past month. In that same time, the Computer and Technology sector gained 2.42%, while the S&P 500 lost 3.9%.
Investors will be hoping for strength from TSMC as it approaches its next earnings release. In that report, analysts expect TSMC to post earnings of $1.21 per share. This would mark a year-over-year decline of 13.57%. Our most recent consensus estimate is calling for quarterly revenue of $17.3 billion, down 1.53% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.57 per share and revenue of $78.45 billion. These totals would mark changes of -15.22% and +3.39%, respectively, from last year.
Any recent changes to analyst estimates for TSMC should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.6% lower. TSMC is holding a Zacks Rank of #4 (Sell) right now.
Investors should also note TSMC's current valuation metrics, including its Forward P/E ratio of 16.07. For comparison, its industry has an average Forward P/E of 16.07, which means TSMC is trading at a no noticeable deviation to the group.
Investors should also note that TSM has a PEG ratio of 0.78 right now. 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. TSM's industry had an average PEG ratio of 0.78 as of yesterday's close.
The Semiconductor - Circuit Foundry industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 242, which puts it in the bottom 4% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
To follow TSM in the coming trading sessions, be sure to utilize Zacks.com.
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