Needham Raises Taiwan Semi Price Target to $480
Needham analyst Charles Shi raised the price target on Taiwan Semi (NYSE: TSM) to $480.00 (from $410.00) while maintaining a Buy rating.
“TSMC delivered another strong beat-and-raise quarter, raised FY26 revenue target to “over 30% growth” (vs. “close to 30% growth”), and raised FY26 CapEx to the high end of the $52-56B range.
We think the best highlight is the 66.2% GM reported for 1Q26 and the 66.5% GM guided for 2Q26.
AI demand outlook remains robust and increasing, while high-end smartphone is expected to do well despite the memory pricing pressure.
TSMC is clearly trying to maintain a delicate balance between meeting customer demand and avoiding CapEx overrun given the severe AI semiconductor supply shortage.
We sense there may be some concerns on “peak margin” but history shows that betting on TSMC margin compression has negative risk/reward.
Overall, a strong print that one can hardly pick on. Our estimates have moved up nicely, and our PT is increased to $480.”
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