Morgan Stanley downgrades the stock rating of TSMC in the latest report

- Advertisement -JBL

According to a recent report submitted by the investment bank, Morgan Stanley, the Taiwan Semiconductor Manufacturing Company (TSMC) received a downgrade rating for its capital expenditure for the coming years. As we know, that TSMC plans to invest $100 billion over the next three years due to its plans of aggressively developing leading-edge chip manufacturing process nodes.

In their report, Morgan Stanley has cut TSMC’s share price to NT$ 580 from NT$ 655 and downgraded the stock’s rating to Neutral. There are several reasons explained for this downgrade, first is that the fab is now on track to produce its latest 3nm chip node next year and is currently supplying tech giants such as Apple Inc.

However, TSMC is also planning to customize its chip process nodes, since it’s now planning to take on the king of silicon valley, Intel. but, Morgan Stanley indicates that as TSMC will grow faster than the chip sector, the market has overestimated this growth rate. Instead, analysts believe that extensive capital spending will harm TSMC’s gross margins.

For the first quarter of this year, the margin stood at 52.4% in the first quarter of this year, and TSMC’s revenues grew by 16.7% the quarter, and its production costs are growing at 15.2%. however, due to the ongoing pandemic, the demand for consumer electronics grew. This resulted in more demand for TSMC’s products, and many analysts worry that in the fourth quarter the chip demand might drop following the aforementioned aggressive growth.


- Advertisement -
Nivedita Bangari
I am a software engineer by profession and technology is my love, learning and playing with new technologies is my passion.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Related Articles

More To Consider


Stay Connected

Boat Lifestyle [CPS] IN

Hot Topics

Latest Articles



Adblocker detected! Please consider reading this notice.

We've detected that you are using AdBlock Plus or some other adblocking software which is preventing the page from fully loading.

We don't have any banner, Flash, animation, obnoxious sound, or popup ad. We do not implement these annoying types of ads!

We need money to operate the site, and almost all of it comes from our online advertising.

Please add to your ad blocking whitelist or disable your adblocking software.