Shares of Taiwan Semiconductor Manufacturing (NYSE:TSM) rose 57.4% in 2019, according to data from S&P Global Market Intelligence. The company, which manufactures semiconductors on behalf of factory-less chip designers such as Advanced Micro Devices (NASDAQ:AMD) and Qualcomm, tracked the general market closely until September. That’s where analysts and investors started waking up to a rebound in the semiconductor industry that should trigger solid growth for Taiwan Semi in the near future.
Blue chip analyst firm Goldman Sachs got the party started with a conviction buy rating on Taiwan Semi’s stock near the end of September, pegging the target price near $55 per share at a time when shares were changing hands for approximately $45 per share. That analyst move lifted Taiwan Semi’s share prices by 5% in a single day and triggered a steady climb over the next several weeks.
When smaller analyst house Susquehanna reiterated its positive rating on the stock in December, Taiwan Semi had already surged past Goldman’s price target to trade at $59 per share. Susquehanna analyst Mehdi Hosseini cited Taiwan Semi’s advanced manufacturing process as a key driver of AMD’s market-stomping success, arguing that the AMD story should help Taiwan Semi find more work and demand higher prices for its services in the near term.