Shares of the Taiwan Semiconductor Manufacturing Co. (TSMC) rose to a record intraday high in Taipei's stock market Monday (July 8) after Morgan Stanley and other brokers boosted price targets on the company before its earnings.
Bloomberg reported that the chipmaker's shares jumped to as high as 4.5%, extending its rally this year to more than 75%.
It is understood that Morgan Stanley was the latest in several brokers to raise their targets on TSMC's stock by about 9%, with an expectation that the company would increase its full-year sales estimate in the earnings announcement next week. The chipmaker also increased its wafer prices due to its strong bargaining power.
Charlie Chan and several Morgan Stanley analysts said in a note dated Sunday (July 7) that TSMC's "hunger marketing" strategy seemed to be working, explaining that its latest supply chain checks show that the firm indicated that the leading-edge foundry supply could be tight next year and that capacity could be lower than customer expectation.
Other Broker Analyses Show Increased Revenue
Aside from Morgan Stanley, JPMorgan analysts, including Gokul Hariharan, also anticipated TSMC would raise its revenue guidance.
In an earnings call Sunday, Hariharan said that TSMC is expected to become more constructive regarding the demand for artificial intelligence (AI).
Other brokers like Nomura Holdings and Mizuho Securities expressed optimism over TSMC's second-quarter results.
It is expected that the company will report a 36% revenue growth from last year.
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