Taiwan Semiconductor Manufacturing (NYSE:TSM) Shares Down 2.2% – Time to Sell?

Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) was down 2.2% on Friday. The stock traded as low as $410.58 and last traded at $413.1480. Approximately 16,014,792 shares were traded during mid-day trading, an increase of 22% from the average daily volume of 13,096,113 shares. The stock had previously closed at $422.25.

Trending Headlines about Taiwan Semiconductor Manufacturing

Here are the key news stories impacting Taiwan Semiconductor Manufacturing this week:

• Positive Sentiment: Record results and strong guidance support the long-term outlook. Third-quarter net income rose 68.7% year over year to NT$763.1 billion, while revenue increased about 51% and exceeded analyst estimates. TSMC also forecast fourth-quarter revenue of $52.3 billion to $54.3 billion, well above the consensus estimate. TSMC posts record profit for a sixth straight quarter
• Positive Sentiment: AI demand remains the key growth driver. Advanced technologies represented 79% of wafer revenue, and management reported no signs of a slowdown in demand for AI and high-performance-computing chips. Full-year 2026 revenue growth is expected to be approximately 44%, while annual 2-nanometer capacity is projected to more than double in 2027. Three key takeaways for long-term investors
• Positive Sentiment: Analysts remain bullish. DA Davidson reaffirmed its Buy rating with a $500 target, while Needham raised its target to $560. Articles also highlight TSMC’s manufacturing scale and competitive moat as potential benefits from continued AI infrastructure investment. TSMC long-term investment outlook
• Neutral Sentiment: Capacity expansion is both an opportunity and a concern. TSMC is considering additional U.S. expansion, including potential involvement in Elon Musk’s proposed Texas “Terafab,” while Taiwan is planning Texas industrial parks for Nvidia suppliers. These projects could improve customer access and supply-chain resilience but increase execution and investment requirements. TSMC talks with Elon Musk’s Terafab
• Negative Sentiment: Large capital expenditures are weighing on sentiment. TSMC’s roughly $64 billion spending plan has prompted questions about returns, potential overcapacity and whether AI demand can justify the industry’s investment pace. Investors also remain concerned about AI companies’ debt financing and profitability. Why TSMC’s spending plan concerns investors
• Negative Sentiment: Sector-wide risk aversion is overpowering the earnings beat. Chip stocks are selling off amid inflation, higher interest rates, concerns about AI financing and questions about whether the AI boom has already been priced into valuations. Commentary also notes that TSMC’s strong results may have raised expectations too high. Chip stocks tumble on AI investment worries

Analysts Set New Price Targets

A number of analysts have commented on the company. Barclays boosted their target price on Taiwan Semiconductor Manufacturing from $665.00 to $670.00 and gave the stock an “overweight” rating in a research report on Friday. Sanford C. Bernstein upped their target price on Taiwan Semiconductor Manufacturing from $430.00 to $554.00 and gave the company an “outperform” rating in a report on Tuesday, August 11th. Stifel Nicolaus initiated coverage on Taiwan Semiconductor Manufacturing in a research report on Tuesday, September 1st. They issued a “buy” rating and a $515.00 price target for the company. TD Cowen raised their price target on Taiwan Semiconductor Manufacturing from $400.00 to $440.00 and gave the company a “hold” rating in a research report on Friday, July 17th. Finally, Wall Street Zen downgraded Taiwan Semiconductor Manufacturing from a “strong-buy” rating to a “buy” rating in a research note on Saturday, August 8th. Three analysts have rated the stock with a Strong Buy rating, eleven have assigned a Buy rating and two have issued a Hold rating to the company’s stock. According to MarketBeat, Taiwan Semiconductor Manufacturing has an average rating of “Buy” and an average target price of $528.78.

Taiwan Semiconductor Manufacturing Stock Down 2.2%

The firm’s 50 day moving average is $434.71 and its two-hundred day moving average is $417.11. The stock has a market cap of $2.14 trillion, a price-to-earnings ratio of 26.59, a P/E/G ratio of 0.85 and a beta of 1.37. The company has a current ratio of 2.46, a quick ratio of 2.25 and a debt-to-equity ratio of 0.14.

Taiwan Semiconductor Manufacturing (NYSE:TSM) last released its earnings results on Tuesday, September 8th. The semiconductor company reported $4.62 earnings per share (EPS) for the quarter. Taiwan Semiconductor Manufacturing had a net margin of 51.51% and a return on equity of 42.84%. The company had revenue of $46.87 billion for the quarter. On average, sell-side analysts predict that Taiwan Semiconductor Manufacturing Company Ltd. will post 16.90 EPS for the current year.

Taiwan Semiconductor Manufacturing Cuts Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, January 7th. Stockholders of record on Thursday, December 10th will be given a $1.0854 dividend. This is a drop from Taiwan Semiconductor Manufacturing’s previous quarterly dividend of $1.1136. This represents a $4.34 dividend on an annualized basis and a dividend yield of 1.1%. The ex-dividend date of this dividend is Thursday, December 10th. Taiwan Semiconductor Manufacturing’s dividend payout ratio (DPR) is presently 22.07%.

Insider Activity

In other news, VP Shyue-Shyh Lin acquired 1,000 shares of Taiwan Semiconductor Manufacturing stock in a transaction that occurred on Tuesday, July 21st. The shares were acquired at an average price of $74.13 per share, with a total value of $74,130.00. Following the completion of the purchase, the vice president owned 30,269 shares of the company’s stock, valued at approximately $2,243,840.97. This represents a 3.42% increase in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, VP Lipen Yuan bought 1,000 shares of the firm’s stock in a transaction that occurred on Tuesday, August 18th. The shares were purchased at an average price of $74.50 per share, for a total transaction of $74,500.00. Following the transaction, the vice president owned 6,000 shares of the company’s stock, valued at $447,000. The trade was a 20.00% increase in their position. Additional details regarding this purchase are available in the official SEC disclosure. Insiders bought a total of 13,043 shares of company stock valued at $970,386 over the last 90 days. Insiders own 1.11% of the company’s stock.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in the business. Signature Resources Capital Management LLC boosted its holdings in Taiwan Semiconductor Manufacturing by 62.5% in the 3rd quarter. Signature Resources Capital Management LLC now owns 104 shares of the semiconductor company’s stock worth $47,000 after acquiring an additional 40 shares during the period. Onyx Bridge Wealth Group LLC grew its position in Taiwan Semiconductor Manufacturing by 25.7% in the third quarter. Onyx Bridge Wealth Group LLC now owns 3,172 shares of the semiconductor company’s stock valued at $1,447,000 after acquiring an additional 648 shares in the last quarter. SteelPeak Wealth LLC grew its position in Taiwan Semiconductor Manufacturing by 13.2% in the third quarter. SteelPeak Wealth LLC now owns 12,595 shares of the semiconductor company’s stock valued at $5,746,000 after acquiring an additional 1,464 shares in the last quarter. CRA Financial Services LLC raised its stake in shares of Taiwan Semiconductor Manufacturing by 8.4% during the third quarter. CRA Financial Services LLC now owns 1,692 shares of the semiconductor company’s stock valued at $772,000 after purchasing an additional 131 shares during the period. Finally, Frank Rimerman Advisors LLC raised its stake in shares of Taiwan Semiconductor Manufacturing by 0.5% during the third quarter. Frank Rimerman Advisors LLC now owns 57,645 shares of the semiconductor company’s stock valued at $26,297,000 after purchasing an additional 275 shares during the period. Hedge funds and other institutional investors own 16.51% of the company’s stock.

Taiwan Semiconductor Manufacturing Company Profile

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), commonly known as TSMC, is a dedicated semiconductor foundry headquartered in Hsinchu, Taiwan. The company manufactures integrated circuits for customers that design their own chips, allowing semiconductor, electronics, and technology companies to outsource production rather than operate their own fabrication facilities.

TSMC provides wafer fabrication services across a broad range of process technologies, including advanced nodes used in high-performance computing, smartphones, automotive systems, and artificial intelligence applications.