TSMC (NYSE:TSM) gained in trading on Wednesday after top-rated Bank of America analyst Brad Lin reiterated a Buy rating on TSM stock and raised the price target to $180. The analyst’s new price target implies an upside potential of 2.4% from current levels.
Lin’s Rationale About TSM Stock
The analyst stated that the chipmaker was an “indispensable and reliable partner” to Apple (NASDAQ:AAPL). Lin’s statement comes after AAPL announced its foray into AI at the WWDC event earlier this week.
AAPL is TSMC’s largest customer, making up more than 20% of its revenues. Lin stated that AAPL’s foray into AI could result in higher demand for TSMC’s semiconductors. The analyst added that Apple’s introduction of Private Cloud Compute has led to strong demand for 3-nanometer nodes in the first half of this year. These 3-nanometer chips provide advanced chip performance.
TSMC has largely benefited from the AI race as its revenues surged by 30% year-over-year in May.
Is TSM a Buy, Sell, or Hold?
Analysts remain bullish about TSM stock, with a Strong Buy consensus rating based on a unanimous 11 Buys. Year-to-date, TSM has surged by more than 60%, and the average TSM price target of $151.68 implies a downside potential of 13% from current levels.
