Taiwan Semiconductor Manufacturing Company (TSM), or TSMC, recently reported strong fourth-quarter results and upbeat guidance, highlighting solid demand for advanced chips. The stock has climbed about 62% in 2025, driven by rising orders from major customers such as Apple (AAPL) and Nvidia (NVDA), along with improving supply conditions in the chip market. Following the earnings report, Cathie Wood increased her exposure to TSMC, buying 5,542 shares worth roughly $1.89 million on Friday, January 16. The move signals continued confidence in TSMC’s long-term role as a key supplier of advanced chips, as Wall Street remains broadly positive on the stock’s outlook.
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To add context, TSM reported a 35% jump in fourth-quarter profit, beating estimates on strong demand for AI chips. For Q4 FY25, the chipmaker posted net income of NT$505.74 billion (about $16 billion), with diluted earnings of NT$19.50 per share, or $3.14 per ADR. Revenue rose 25.5% from a year earlier to NT$1.046 trillion ($33.73 billion), also coming in above expectations.
Analysts Remain Optimistic about TSM Stock
Following Q4 earnings results, Morgan Stanley maintained a Buy rating on the stock and raised the price target by 5% to NT$2,088. The bank said the upgrade was driven mainly by better-than-expected margins and clearer earnings visibility, helped by strong demand for AI chips. Morgan Stanley also pointed to higher capital spending and improving margins as signs of strength, keeping the stock as a “top pick.” Overall, analysts said the stock looks attractive at current levels and believe it could draw more investor interest going forward.
Meanwhile, top TD Cowen analyst Krish Sankar raised his price target on TSM to $370 from $325 while keeping a Hold rating. The 5-star analyst said the higher price target reflects strong execution, as TSMC delivered better-than-expected results and lifted its long-term growth outlook, driven by rising AI and cloud demand. Sankar also pointed to higher capital spending plans as a positive signal for future demand, though he warned that new chip node rollouts and overseas factory expansions could weigh on margins over time.
Also, BofA Securities analyst Brad Lin raised his price target on Taiwan Semiconductor to $470 from $430 while keeping a Buy rating. Lin said TSMC’s technology lead should support much stronger pricing over the next few years, driven by higher prices for advanced chips and a better product mix. He expects demand for advanced nodes to stay solid, helping sales grow faster than costs and pushing margins higher in 2026 and 2027.
Is TSM a Good Stock to Buy?
Analysts remain highly optimistic about Taiwan Semiconductor’s long-term prospects. On TipRanks, TSMC has a Strong Buy consensus rating based on seven Buys and one Hold rating. The average Taiwan Semiconductor Manufacturing price target of $320.61 implies nearly 2% downside potential from current levels. Over the past year, TSM shares have gained over 58%.
