BofA Remains Bullish on Taiwan Semiconductor Manufacturing (TSM) – Here’s Why

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is one of the safe stocks for beginners to buy in 2026. BofA lifted the price target on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) to $590 from $490 on June 24 and maintained a Buy rating on the shares. The firm stated that in a backdrop featuring rising agentic AI demand, it anticipates much stronger CPU demand to consume more capacity across advanced front-end manufacturing and back-end packaging. The firm raised TSMC sales expectations in 2026 and 2027 to 40% and 39% year-over-year, respectively, to take into account a stronger CPU and AI GPU/ASIC demand outlook.

Is TSM a good stock to buy?

In a separate development, Susquehanna lifted the price target on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) to $575 from $500 on June 22 and maintained a Positive rating on the shares. The firm updated its model, including its capex and capacity strategy, which it believes will exceed both consensus and buy-side expectations. Susquehanna believes that the key uncertainty remains how token growth and the associated silicon requirements could drive potential supply-demand imbalances.

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the largest contract semiconductor manufacturer in the world. Some of its prominent customers include semiconductor companies that outsource all or part of their chip production, including Advanced Micro Devices, Nvidia, Broadcom, and more.

While we acknowledge the risk and potential of TSM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TSM and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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