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TSMC (TSM) Dips More Than Broader Market: What You Should Know

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The most recent trading session ended with TSMC (TSM - Free Report) standing at $140.22, reflecting a -0.9% shift from the previouse trading day's closing. This move lagged the S&P 500's daily loss of 0.72%. Elsewhere, the Dow lost 1%, while the tech-heavy Nasdaq lost 0.95%.

The the stock of chip company has risen by 2.34% in the past month, equaling the Computer and Technology sector and overreaching the S&P 500's gain of 2.16%.

The upcoming earnings release of TSMC will be of great interest to investors. The company's earnings per share (EPS) are projected to be $1.29, reflecting a 1.53% decrease from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $18.38 billion, indicating a 9.96% growth compared to the corresponding quarter of the prior year.

TSM's full-year Zacks Consensus Estimates are calling for earnings of $6.16 per share and revenue of $85.41 billion. These results would represent year-over-year changes of +18.92% and +23.24%, respectively.

Investors should also note any recent changes to analyst estimates for TSMC. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.16% lower within the past month. TSMC currently has a Zacks Rank of #3 (Hold).

In terms of valuation, TSMC is currently trading at a Forward P/E ratio of 22.96. This signifies no noticeable deviation in comparison to the average Forward P/E of 22.96 for its industry.

It's also important to note that TSM currently trades at a PEG ratio of 1.08. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Semiconductor - Circuit Foundry industry currently had an average PEG ratio of 1.08 as of yesterday's close.

The Semiconductor - Circuit Foundry industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 93, this industry ranks in the top 37% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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