Needham analyst Charles Shi has maintained their bullish stance on TSM stock, giving a Buy rating yesterday.
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Charles Shi’s rating is based on the potential strategic benefits of TSMC considering a takeover of Intel’s foundry operations. This move is seen as a viable option given Intel Foundry’s current financial struggles and lack of prospective buyers, which makes TSMC a suitable candidate to step in and manage those operations.
Shi believes that, despite a potential short-term earnings impact with an estimated reduction in EPS by over 20%, the long-term advantages could outweigh these initial drawbacks. By acquiring Intel Foundry, TSMC could mitigate geopolitical risks by aligning more closely with U.S. interests, which in turn could positively influence the stock’s valuation over time.
In another report released yesterday, Bank of America Securities also maintained a Buy rating on the stock with a $265.00 price target.