BofA Raises TSMC Price Target on Strong Outlook, Keeps Buy Rating

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is one of the 10 Unrivaled Stocks of the Next 5 Years. On April 13, BofA Securities increased its price target on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) from NT$2,360 to NT$2,530 while keeping a Buy rating on the stock.

BofA expects the company’s sales to grow by 7% to 9% quarter-over-quarter in the second quarter of 2026. This compares with 8% growth in the first quarter of 2026. The firm believes that the growth in the second quarter will be driven by a solid backlog of high-performance computing orders.

Image: TSMC

The research firm also expects Taiwan Semiconductor Manufacturing Company Limited’s (NYSE:TSM) gross margins to improve slightly. Margins are projected to grow from the first-quarter guidance range of 63% to 65% to around 66% in the second quarter of 2026. This improvement is expected despite challenges such as the ramp-up of 2-nanometer production and higher electricity costs during the summer.

BofA pointed out that it values Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) at 20 times its estimated 2027 earnings, compared with the current valuation of 15 times. This is within the stock’s long-term range of 11 to 21 times. The firm pointed to the company’s strong position in leading-edge technologies and its share of manufacturing capacity as reasons supporting the valuation.

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a Taiwanese multinational semiconductor contract manufacturing and design company that manufactures, packages, and tests integrated circuits for various industries.

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