TSMC Poised for Growth in 2024 as Chip Demand Rebounds and Tech Leadership Drives Advanced Manufacturing
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TSMC is the world's largest semiconductor foundry. As the economy improves in 2024, demand for chips should rebound, boosting TSMC's revenue growth.
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Secular trends like AI, 5G, and the Internet of Things are fueling rising demand for advanced chips that TSMC specializes in manufacturing.
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TSMC is staying ahead of rivals with cutting-edge 3nm and future 2nm manufacturing technology. But its lead is narrowing as competitors like Samsung and Intel aim to catch up.
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Gross margins declined in 2022 due to economic weakness and costs associated with ramping up new 3nm tech. Margins may remain pressured until yields improve.
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Valuation looks attractive with 2024 P/E of 17.6x, below the industry average despite over 20% expected revenue growth. Consensus price target implies nearly 18% upside.