TSMC shares boosted by Chang’s upbeat forecast
Shares of Taiwan Semiconductor Manufacturing Co. ( TSMC,
) moved higher Wednesday morning as investors were encouraged by a positive forecast made by TSMC Chairman Morris Chang ( ) about the world’s largest contract chip-maker’s outlook, dealers said.
The 0.79 percent gains posted by TSMC’s American depositary receipts (ADRs) on Wall Street overnight against a lackluster Dow Jones Industrial Average overnight also led investors here to chase the stock soon after the local bourse opened, they said.
As of 11:50 a.m., shares of TSMC, the most heavily weighted stock in the local market, had added 1.44 percent to NT$141.00 (US$4.53) with 23.28 million shares changing hands. A higher TSMC led the weighted index on the Taiwan Stock Exchange to stage a rebound, up 1.46 percent at 9,326.24 points.
“As Chang spoke, the market listened. That’s why investors rushed to pick up the stock after Chang made the comments in the annual general meeting held on Tuesday,” Hua Nan Securities analyst Kevin Su said.
Speaking to TSMC’s shareholders, Chang said that TSMC will have a better second half of this year than the first half after slow season effects seen in the January-June period fade.
Chang said that he has maintained a forecast for TSMC made in midApril that the chip maker will enjoy a more than 10 percent increase in sales and profit for 2015. The comments dispelled market concerns over a possible extension of inventory adjustments in the global semiconductor industry, dealers said.
Chang said that although the global integrated circuit business has kicked off a series of merger and acquisition deals, such consolidation has imposed limited impact on TSMC’s operations.
Among the latest deals, U.S.based IC giant Intel Corp. announced earlier this month that it had agreed to acquire Altera, a programmable logic semiconductor supplier, for US$16.7 billion. Altera is one of TSMC’s buyers.
Before Chang spoke of the deals, the market had worries that these consolidation trends in the industry could prompt its buyers to shift orders from the Taiwanese chip maker to its competitors.
But, Chang said that TSMC did not suffer any large cutback in orders by its customers so far, and the global semiconductor industry still heavily depends on TSMC’s technology and production capacity.
Barclays Capital analyst Andrew Lu said that after the consolidation of TSMC’s share price in the recent session, the stock appeared attractive for the moment.