Morgan Stanley: Raises TSMC Target Price to 2,988 TWD, Maintains "Overweight" Rating

Deep Tide TechFlow reports that on July 17, according to the "STAR Market Daily," Morgan Stanley released a report stating that TSMC's 2026 full-year revenue guidance significantly exceeded expectations. The company raised its 2026 revenue growth guidance to over 40% year-on-year, up from the previous forecast of over 30%. Management attributed the upward revision to strong AI demand, despite challenges in consumer demand. Cloud service provider (CSP) clients are rapidly increasing cloud capital expenditures. TSMC has not updated its AI semiconductor revenue CAGR forecast but indicated that actual performance has exceeded the previous prediction of 55%-60%. The firm believes that a 70%-80% CAGR for TSMC's AI semiconductor business is a reasonable assumption. Morgan Stanley raised its target price from 2,888 TWD to 2,988 TWD and maintained its "Overweight" rating. In a volatile market environment, the company's strong profitability should continue to attract capital inflows. The upcoming updates on CSP clients' cloud capital expenditures for the second quarter of 2026 will serve as a key catalyst.