TSMC nears 52-week high as Citi hikes target 32% to NT$3,800

TSMC shares traded near a 52-week high after Citi Research raised its price target 32% to NT$3,800, citing AI chip demand expanding beyond graphics processors into custom silicon, networking and CPUs.

"Demand for TSMC's advanced process technologies is spreading beyond AI graphics processors into custom AI chips, cloud TPUs, networking silicon, optical interconnects and CPUs," Citi said in a note. The brokerage reiterated its Buy rating and raised its target to NT$3,800 from NT$2,875.

Taiwan-listed shares changed hands at NT$2,445 to NT$2,465, near the 52-week high of NT$2,535. The new target implies roughly 54% upside from the current trading range. Citi also expects TSMC to raise its 2026 revenue growth outlook and long-term growth targets at its July 16 analyst meeting.

The bull case for the world's largest contract chipmaker is shifting from process technology leadership alone to a combination of leading-edge manufacturing scale and advanced packaging capacity. Citi estimates TSMC's combined leading-edge node capacity could reach 350,000 to 400,000 wafers per month by the end of 2028, supporting higher utilization and pricing power even as depreciation costs rise from heavy capital spending.

UBS analyst Sharon Lin also lifted her TSMC target to NT$3,400 from NT$3,000 and raised capex forecasts for 2026 through 2028, arguing higher investment commitments should help ease customer concerns about supply constraints and second-source diversification.

The broadening AI cycle makes TSMC less dependent on any single product line or customer. Demand is flowing into custom AI chips, cloud tensor processing units, networking silicon, optical interconnects and CPUs — each requiring not just advanced nodes such as N2 and N3 but also the packaging technologies needed to turn those chips into usable AI systems.

For holders, the analyst upgrades signal confidence that TSMC's pricing power and capacity expansion can sustain margin expansion through 2028. The next catalyst is the company's July 16 earnings report, where investors will watch for updated revenue guidance and capex plans.

This article is for informational purposes only and does not constitute investment advice.