Taiwan Semiconductor Manufacturing (NYSE:TSM) Stock Price Down 11% – Here’s Why

Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM)’s stock price dropped 11% on Thursday. The stock traded as low as $351.19 and last traded at $352.1940. Approximately 41,794,794 shares traded hands during trading, an increase of 218% from the average session volume of 13,140,400 shares. The stock had previously closed at $395.75.

Key Headlines Impacting Taiwan Semiconductor Manufacturing

Here are the key news stories impacting Taiwan Semiconductor Manufacturing this week:

• Positive Sentiment: Taiwan tightened short-selling rules and prepared a reported $15 billion fund to support its markets, helping lift TSMC shares in premarket trading after the regional chip rout. Benzinga article
• Positive Sentiment: Nvidia reportedly wants TSMC to make advanced memory chips. If TSMC pursues the opportunity, it could broaden its role in AI hardware and deepen ties with a major customer; the report describes a possibility, not a confirmed project. TipRanks article
• Positive Sentiment: Sanford C. Bernstein raised its price target to $600 from $554 and reiterated an “outperform” rating, signaling confidence in TSMC’s prospects despite the recent sector weakness. MarketBeat analyst update
• Neutral Sentiment: TSMC’s position as a leading manufacturer for Nvidia, AMD and other chip designers supports exposure to AI demand across competing customers. Some coverage also argues the shares trade below their usual valuation range, though that does not ensure a near-term recovery. The Motley Fool article
• Negative Sentiment: The rebound follows a steep regional chip-stock selloff amid worries about AI valuations, spending expectations and growth. That market-wide pressure could keep TSM volatile even as its manufacturing business benefits from AI demand. 24/7 Wall St. article

Analyst Upgrades and Downgrades

Several brokerages recently issued reports on TSM. Zacks Research raised Taiwan Semiconductor Manufacturing from a “hold” rating to a “strong-buy” rating in a research note on Thursday, July 16th. TD Cowen lifted their target price on Taiwan Semiconductor Manufacturing from $400.00 to $440.00 and gave the company a “hold” rating in a research note on Friday, July 17th. Weiss Ratings downgraded Taiwan Semiconductor Manufacturing from a “buy (b)” rating to a “hold (c+)” rating in a report on Wednesday. Wall Street Zen downgraded Taiwan Semiconductor Manufacturing from a “strong-buy” rating to a “buy” rating in a report on Saturday, August 8th. Finally, Needham & Company LLC increased their price target on shares of Taiwan Semiconductor Manufacturing from $530.00 to $560.00 and gave the stock a “buy” rating in a research report on Thursday, October 15th. Three research analysts have rated the stock with a Strong Buy rating, eleven have given a Buy rating and two have assigned a Hold rating to the stock. According to MarketBeat, Taiwan Semiconductor Manufacturing presently has a consensus rating of “Buy” and a consensus price target of $533.89.

Taiwan Semiconductor Manufacturing Stock Up 6.2%

The business’s 50 day simple moving average is $431.68 and its 200-day simple moving average is $400.77. The company has a debt-to-equity ratio of 0.14, a quick ratio of 2.25 and a current ratio of 2.46. The company has a market cap of $1.95 trillion, a price-to-earnings ratio of 24.14, a price-to-earnings-growth ratio of 0.81 and a beta of 1.44.

Taiwan Semiconductor Manufacturing (NYSE:TSM) last posted its quarterly earnings results on Thursday, October 15th. The semiconductor company reported $4.60 earnings per share for the quarter, topping analysts’ consensus estimates of $4.45 by $0.15. Taiwan Semiconductor Manufacturing had a net margin of 51.51% and a return on equity of 42.84%. The business had revenue of $46.72 billion for the quarter, compared to the consensus estimate of $45.67 billion. During the same period in the prior year, the business posted $2.92 earnings per share. Taiwan Semiconductor Manufacturing’s revenue for the quarter was up 41.2% compared to the same quarter last year. Sell-side analysts expect that Taiwan Semiconductor Manufacturing Company Ltd. will post 17.07 earnings per share for the current year.

Taiwan Semiconductor Manufacturing Cuts Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, January 7th. Shareholders of record on Thursday, December 10th will be given a $1.0854 dividend. This represents a $4.34 annualized dividend and a yield of 1.2%. The ex-dividend date of this dividend is Thursday, December 10th. This is a decrease from Taiwan Semiconductor Manufacturing’s previous quarterly dividend of $1.1136. Taiwan Semiconductor Manufacturing’s payout ratio is currently 22.27%.

Insider Buying and Selling at Taiwan Semiconductor Manufacturing

In other news, VP Lipen Yuan purchased 1,000 shares of the business’s stock in a transaction dated Sunday, November 1st. The stock was bought at an average cost of $71.49 per share, with a total value of $71,490.00. Following the purchase, the vice president directly owned 8,000 shares of the company’s stock, valued at approximately $571,920. This trade represents a 14.29% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. Over the last three months, insiders bought 5,428 shares of company stock worth $411,021. 1.11% of the stock is owned by company insiders.

Institutional Investors Weigh In On Taiwan Semiconductor Manufacturing

Several large investors have recently made changes to their positions in TSM. Tiger Global Management LLC increased its stake in shares of Taiwan Semiconductor Manufacturing by 49.4% during the 1st quarter. Tiger Global Management LLC now owns 5,565,074 shares of the semiconductor company’s stock worth $1,880,717,000 after purchasing an additional 1,839,600 shares during the last quarter. Fundsmith LLP bought a new position in shares of Taiwan Semiconductor Manufacturing during the 2nd quarter valued at $548,465,000. Assenagon Asset Management S.A. bought a new position in shares of Taiwan Semiconductor Manufacturing during the 2nd quarter valued at $490,461,000. Mirae Asset Global Investments Co. Ltd. acquired a new stake in shares of Taiwan Semiconductor Manufacturing in the 3rd quarter valued at $444,923,000. Finally, Aberdeen Group plc lifted its stake in shares of Taiwan Semiconductor Manufacturing by 449.6% in the 3rd quarter. Aberdeen Group plc now owns 642,465 shares of the semiconductor company’s stock valued at $293,086,000 after purchasing an additional 525,566 shares during the last quarter. Institutional investors own 16.51% of the company’s stock.

Taiwan Semiconductor Manufacturing Company Profile

Taiwan Semiconductor Manufacturing Company (TSMC) is a semiconductor foundry that manufactures chips designed by other companies. It provides wafer fabrication and related services, including advanced packaging, serving customers across industries such as computing, communications, automotive and consumer electronics.

Founded in 1987 and headquartered in Hsinchu, Taiwan, TSMC helped establish the dedicated foundry model, in which a manufacturer focuses on producing semiconductors for customers rather than selling its own chip designs.