Chipmaker Taiwan Semiconductor (NYSE:TSM) reported sales of about NT$215.79 billion ($6.9 billion) for January 2024. This reflects a sequential growth of 22.4% and an increase of 7.9% from January 2023. Following the positive update, TSM stock gained about 5% on Wednesday and another 1.3% in after-hours trading.
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The company benefited from a strong demand for artificial intelligence (AI) chips, which helped offset a slowdown in consumer electronics products. Also, the rising competition in the technology sector to offer AI-powered applications may boost the demand for AI chips. As per a Statista report, the AI chip market is expected to grow 30% year-over-year in 2024.
It is worth mentioning that TSM has already taken steps to enhance its production capacity. Earlier this week, the company announced its plans to build a second Japanese plant by the end of 2027. Furthermore, Taiwan Semiconductor’s focus on advancing chip fabrication technology, especially with its 3-nanometer, positions it well for future growth.
What is the Price Target for TSM Stock?
Wall Street analysts maintain a bullish outlook on TSM stock. With five unanimous Buy recommendations, Taiwan Semiconductor sports a Strong Buy consensus rating. The average TSM stock price target of $138.60 per share implies a 10.9% upside potential from current levels. TSM stock gained about 36% in the past three months, outperforming the S&P 500’s (SPX) gain of about 13%.
