TSMC(US:TSM) GOLDEN SUN SECURITIES·2024-10-24 03:16Investment Rating - The report maintains a "Buy" rating for TSMC, with a target price of $242, corresponding to a market value of $125.71 billion [1]. Core Views - TSMC's Q3 2024 performance exceeded expectations, with revenue of $23.5 billion and a year-over-year growth of 39%. The gross margin reached 57.8%, surpassing the upper limit of guidance [1]. - The demand for AI is robust, particularly in high-performance computing (HPC), which accounted for 51% of TSMC's revenue in Q3 2024. The company anticipates rapid capacity ramp-up due to increased capital expenditures and new factory openings [1][10]. - TSMC's advanced process technology, particularly 3nm and 5nm, continues to contribute significantly to revenue, with a combined share of 69% of total wafer revenue [1]. Financial Summary - Revenue projections for TSMC are as follows: NT$2,871.67 billion for 2024, NT$3,455.95 billion for 2025, and NT$4,070.72 billion for 2026, reflecting year-over-year growth rates of 33%, 20%, and 18% respectively [1][10]. - Net profit estimates are NT$1,157.60 billion for 2024, NT$1,489.09 billion for 2025, and NT$1,738.76 billion for 2026, with growth rates of 38%, 29%, and 17% respectively [1][10]. - The report indicates a gross margin of 55.8% for 2024, expected to improve to 57.3% by 2026 [10]. Business Segments - Revenue contributions from various segments in 2024 are projected as follows: HPC at NT$140.67 billion, smartphones at NT$105.48 billion, IoT at NT$17.31 billion, automotive at NT$13.86 billion, and digital consumer electronics at NT$4.64 billion [10]. - Year-over-year growth rates for these segments are expected to be 50% for HPC, 29% for smartphones, 7% for IoT, 4% for automotive, and a slight decline of 1% for digital consumer electronics [10]. Guidance - For Q4 2024, TSMC's revenue guidance is set between $26.1 billion and $26.9 billion, with a gross margin forecast of 57.0% to 59.0% [1].