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TSMC (TSM) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, TSMC (TSM - Free Report) closed at $59.23, marking a +1.18% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.03%. At the same time, the Dow added 0.11%, and the tech-heavy Nasdaq gained 0.1%.

Heading into today, shares of the chip company had gained 9.58% over the past month, outpacing the Computer and Technology sector's gain of 2.71% and the S&P 500's gain of 1.82% in that time.

Wall Street will be looking for positivity from TSM as it approaches its next earnings report date.

Investors might also notice recent changes to analyst estimates for TSM. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. TSM currently has a Zacks Rank of #3 (Hold).

In terms of valuation, TSM is currently trading at a Forward P/E ratio of 27.35. Its industry sports an average Forward P/E of 27.35, so we one might conclude that TSM is trading at a no noticeable deviation comparatively.

It is also worth noting that TSM currently has a PEG ratio of 2.63. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Semiconductor - Circuit Foundry stocks are, on average, holding a PEG ratio of 2.63 based on yesterday's closing prices.

The Semiconductor - Circuit Foundry industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 98, putting it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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