Why GF Securities Analysts Think You Should Buy Taiwan Semi Stock Now Before April 16.
Taiwan Semiconductor (TSM) is not operating in a quiet market right now. The semiconductor sector has been hot, helped by strong demand for AI and strong chip supply. Nvidia (NVDA) and Advanced Micro Devices (AMD) have already posted big gains, and TSM has been part of that move, too.
The company’s latest numbers show why investors are paying attention. Fourth-quarter revenue was up 20% year-over-year (YOY), and TSM’s first-quarter revenue came in at around $35.7 billion, up 35% YOY. Following the preliminary results, GF Securities reiterated a “Buy” rating on TSM stock and raised its price target ahead of the upcoming April 16 earnings report.
The move reflects strong confidence in Taiwan Semiconductor’s ability to sustain its growth momentum, with analysts expecting AI-driven demand and strong margins to support another strong earnings report.
On the other hand, TSM is just a chipmaker. On the other hand, it is the largest pure gaming platform in the world, and that gives it a special place in the AI series. The company does not design the chips itself. Instead, it produces advanced processors for companies such as Apple (AAPL), Nvidia, AMD, and Qualcomm (QCOM).
That’s important because AI requires high-end silicon. Data centers, smartphones, and AI servers all depend on Taiwan Semiconductor factories. The company’s leadership in advanced nodes, including 2 nanometer chips, provides a strong position and helps support higher margins over time.
Nvidia CEO Jensen Huang praised TSM last year, saying the company is doing a great job of supporting the demand for Blackwell AI GPUs. In addition, TSM’s Arizona fab recently produced the first Nvidia Blackwell wafer on US soil, marking a major milestone in US chip manufacturing.
TSM stock has already had a strong performance so far in 2026. Shares are up nearly 25% year-to-date (YTD), and up nearly 143% over the past 52 weeks. The stock benefited from strong AI chip demand and record sales guidance. While it has regressed slightly from the end of February, the big picture still looks strong.
Even after that run, TSM isn’t cheap. The stock trades at 34.8 times trailing earnings and roughly 15.6 times sales. That price-to-earnings (P/E) ratio is below the industry median for semiconductor peers, which sits at a close 46 times. While the market isn’t treating TSM as a bargain-basement stock, it’s also not pricing it as an extreme growth story. For a company with this kind of scale and chip leadership, many investors still see the valuation as reasonable.
Recent results show that Taiwan Semiconductor’s business is in a strong position. In Q4 2025, revenue reached $33.73 billion, up 20% YOY and coming in above expectations. Net profit up 35% YOY. In Q3, profits again beat forecasts, rising nearly 39% YOY. TSM has a habit of clearing the bar, and the market knows it.
For Q1 2026, analysts expect revenue of $35.7 billion and EPS of $3.31. That would mark earnings growth of around 56% YOY. These estimates are consistent with TSM’s preliminary report, which showed revenue near the upper end of management’s guidance.
Margins will become more concentrated. Management is targeting a Q1 gross margin of about 64% in the middle, and analysts think the final number could be slightly higher. Strong demand for AI, better usability, and pricing power should help.
The company’s full-year outlook also remains upbeat, with CFO Wendell Huang previously forecasting 30% revenue growth in 2026.
GF Securities is more volatile ahead of the earnings report as it believes TSM is set for another beat. The company raised its price target to NT$2,808 from NT$2,325 and maintained a “Buy” rating.
The main reason is the need for AI. GF Securities expects TSM to exceed its guidance for both sales and margins. The company sees Q1 gross margin near 67%, above the company’s range of 63% to 65%. Analysts also believe that higher usage in 2nm and 3nm fabs will help profits.
GF Securities sees sales growth continuing in Q2, with growth of around 6% quarter over quarter, before a possible slowdown later in the year. However, the long-term setup still looks strong as TSM plans to spend more on capex in 2026, with spending expected in the $52 billion to $56 billion range. That shows that the company is still investing in leadership, not just in favor of current needs.
Wall Street is very focused on TSM stock. Of the 18 analysts covering the stock, 14 have a “Strong Buy” rating, two have a “Neutral Buy” rating, and two have a “Hold” rating. The consensus is a “Strong Buy” rating, while the average price is $421.69, implying a potential upside of 11% from current levels.
GF Securities is not alone. Citigroup also recently raised its target to NT$2,800, citing strong demand for the AI chip and expecting 2nm to be a major revenue driver. Morgan Stanley also raised its target and maintained an “Overweight” rating, saying investors should increase positions as demand for AI continues to push revenues higher.
Overall, analysts see TSM as one of the clear beneficiaries of the AI boom. Business is growing, margins are strong, and the technology lead still looks real. That’s why GF Securities thinks now is a good time to buy.
At the date of publication, Nauman Khan did not have (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published on Barchart.com
