Taiwan Semiconductor Manufacturing Company Ltd. $TSM Stock: VMS Asset Management Limited Lowers Position

Key Points

• VMS Asset Management cut its TSMC position by 35.8% in the third quarter, selling 11,505 shares and retaining 20,600 shares worth approximately $9.4 million. TSMC remains about 3.7% of the fund’s portfolio and its seventh-largest holding.
• TSMC reported record third-quarter profit, up 68.7% year over year, driven by strong demand for AI and high-performance-computing chips. Management also issued fourth-quarter revenue guidance well above analyst expectations and said it sees no clear slowdown in AI infrastructure demand.
• Despite strong fundamentals and a consensus analyst rating of “Buy,” TSM shares face valuation and market risks, including an elevated earnings multiple, profit-taking concerns, inflation pressures and broader skepticism about the cost of AI investment.

VMS Asset Management Limited cut its position in shares of Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM - Free Report) by 35.8% during the 3rd quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The fund owned 20,600 shares of the semiconductor company's stock after selling 11,505 shares during the quarter. Taiwan Semiconductor Manufacturing makes up about 3.7% of VMS Asset Management Limited's investment portfolio, making the stock its 7th largest position. VMS Asset Management Limited's holdings in Taiwan Semiconductor Manufacturing were worth $9,398,000 at the end of the most recent reporting period.

A number of other large investors also recently modified their holdings of the company. Janus Henderson Group PLC lifted its holdings in shares of Taiwan Semiconductor Manufacturing by 7.7% in the 4th quarter. Janus Henderson Group PLC now owns 8,291,884 shares of the semiconductor company's stock worth $2,497,638,000 after acquiring an additional 594,780 shares during the last quarter. Tiger Global Management LLC boosted its stake in shares of Taiwan Semiconductor Manufacturing by 49.4% in the 1st quarter. Tiger Global Management LLC now owns 5,565,074 shares of the semiconductor company's stock valued at $1,880,717,000 after purchasing an additional 1,839,600 shares in the last quarter. Invesco Ltd. boosted its stake in shares of Taiwan Semiconductor Manufacturing by 1.1% in the 4th quarter. Invesco Ltd. now owns 3,721,823 shares of the semiconductor company's stock valued at $1,131,025,000 after purchasing an additional 40,842 shares in the last quarter. Sei Investments Co. grew its holdings in shares of Taiwan Semiconductor Manufacturing by 11.8% during the 1st quarter. Sei Investments Co. now owns 2,591,510 shares of the semiconductor company's stock valued at $875,802,000 after purchasing an additional 274,389 shares during the last quarter. Finally, T. Rowe Price Investment Management Inc. raised its position in Taiwan Semiconductor Manufacturing by 168.6% in the 4th quarter. T. Rowe Price Investment Management Inc. now owns 2,093,115 shares of the semiconductor company's stock worth $636,077,000 after purchasing an additional 1,313,917 shares during the period. 16.51% of the stock is owned by hedge funds and other institutional investors.

Taiwan Semiconductor Manufacturing News Roundup

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

• Positive Sentiment: TSMC posted record third-quarter net profit of approximately NT$763 billion, up 68.7% year over year and above the NT$746.3 billion analyst estimate. Revenue also exceeded expectations, supported by strong demand for advanced AI and high-performance-computing chips. TSMC posts record profit for a sixth straight quarter
• Positive Sentiment: Management issued fourth-quarter revenue guidance of $52.3 billion to $54.3 billion, well above the roughly $48.8 billion consensus estimate. Advanced technologies accounted for about 79% of wafer sales, reinforcing TSMC’s position in leading-edge semiconductor manufacturing. TSMC beats estimates as AI demand drives sales growth
• Positive Sentiment: Chief Executive Officer C.C. Wei said he sees no indication of a slowdown, suggesting that AI infrastructure demand remains robust despite concerns that technology companies may be approaching the limits of their spending boom. TSMC CEO sees no sign of a slowdown
• Neutral Sentiment: TSMC also has an approximately $2 billion agreement with GlobalFoundries to manufacture U.S. silicon interposers for advanced AI-chip packaging. The deal supports supply-chain diversification but is unlikely to materially affect near-term earnings.
• Negative Sentiment: Despite the earnings beat, investors appear concerned that much of the AI-driven growth was already reflected in TSM’s valuation. Shares trade near a historically elevated earnings multiple and below their recent high, increasing the risk of profit-taking when results fail to dramatically exceed already aggressive expectations. Why TSM stock is sliding after earnings
• Negative Sentiment: A hotter-than-expected inflation reading and slowing revenue growth reported by Anthropic extended a wider technology and AI-stock selloff. Higher interest-rate concerns and scrutiny of the enormous cost of AI infrastructure are weighing on semiconductor shares, including TSM.

Taiwan Semiconductor Manufacturing Price Performance

Shares of NYSE TSM opened at $430.69 on Thursday. Taiwan Semiconductor Manufacturing Company Ltd. has a fifty-two week low of $266.82 and a fifty-two week high of $487.47. The company has a 50 day simple moving average of $434.77 and a two-hundred day simple moving average of $416.47. The company has a market capitalization of $2.23 trillion, a price-to-earnings ratio of 31.07, a P/E/G ratio of 0.92 and a beta of 1.37. The company has a debt-to-equity ratio of 0.14, a quick ratio of 2.25 and a current ratio of 2.46.

Taiwan Semiconductor Manufacturing (NYSE:TSM - Get Free Report) last issued its earnings results on Tuesday, September 8th. The semiconductor company reported $4.62 EPS for the quarter. Taiwan Semiconductor Manufacturing had a return on equity of 39.25% and a net margin of 50.31%. The business had revenue of $46.87 billion for the quarter. Analysts expect that Taiwan Semiconductor Manufacturing Company Ltd. will post 16.60 EPS for the current fiscal year.

Taiwan Semiconductor Manufacturing Cuts Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, January 7th. Stockholders of record on Thursday, December 10th will be issued a dividend of $1.0854 per share. This represents a $4.34 annualized dividend and a dividend yield of 1.0%. The ex-dividend date of this dividend is Thursday, December 10th. This is a negative change from Taiwan Semiconductor Manufacturing's previous quarterly dividend of $1.1136. Taiwan Semiconductor Manufacturing's payout ratio is currently 24.75%.

Analysts Set New Price Targets

TSM has been the subject of several analyst reports. Zacks Research upgraded Taiwan Semiconductor Manufacturing from a "hold" rating to a "strong-buy" rating in a report on Thursday, July 16th. Stifel Nicolaus initiated coverage on Taiwan Semiconductor Manufacturing in a research note on Tuesday, September 1st. They issued a "buy" rating and a $515.00 price target on the stock. Sanford C. Bernstein boosted their price objective on Taiwan Semiconductor Manufacturing from $430.00 to $554.00 and gave the company an "outperform" rating in a research report on Tuesday, August 11th. Barclays boosted their price objective on Taiwan Semiconductor Manufacturing from $650.00 to $665.00 and gave the company an "overweight" rating in a research report on Tuesday, October 6th. Finally, DA Davidson increased their price objective on Taiwan Semiconductor Manufacturing from $450.00 to $500.00 and gave the company a "buy" rating in a research note on Friday, July 17th. Three investment analysts have rated the stock with a Strong Buy rating, eleven have given a Buy rating and two have given a Hold rating to the stock. According to MarketBeat.com, Taiwan Semiconductor Manufacturing presently has an average rating of "Buy" and an average target price of $524.89.

Insider Activity

In other news, VP Shyue-Shyh Lin acquired 2,000 shares of the business's stock in a transaction that occurred on Sunday, July 19th. The stock was bought at an average price of $71.71 per share, with a total value of $143,420.00. Following the completion of the acquisition, the vice president directly owned 28,269 shares of the company's stock, valued at approximately $2,027,169.99. The trade was a 7.61% increase in their position. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, VP Lipen Yuan bought 1,000 shares of the company's stock in a transaction on Tuesday, August 18th. The stock was purchased at an average cost of $74.50 per share, for a total transaction of $74,500.00. Following the completion of the transaction, the vice president directly owned 6,000 shares of the company's stock, valued at approximately $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 have bought 16,043 shares of company stock valued at $1,185,746 in the last ninety days. 1.11% of the stock is currently owned by company insiders.

Taiwan Semiconductor Manufacturing Profile

Taiwan Semiconductor Manufacturing Company Limited NYSE: TSM, commonly known as TSMC, is a Taiwan-based semiconductor manufacturer and the world's largest dedicated semiconductor foundry. Founded in 1987 by Morris Chang, the company pioneered the pure-play foundry model, producing chips designed by other companies rather than selling products under its own semiconductor brand.

TSMC manufactures a broad range of integrated circuits, including advanced logic chips used in high-performance computing, smartphones, automotive systems, communications equipment, and consumer electronics.

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