TSMC Navigates AI Boom and Geopolitical Risks in 2025

Taiwan Semiconductor Manufacturing Company, with stock symbol TSM, has seen recent fluctuations in its stock price. As of February 4, 2025, the stock price climbed to $204.05 with 10,888,461 million shares trading, following a decline to $199.80 on February 3, 2025, with 15,849,871 million shares trading[1].The company has a beta of 2.05, indicating it is more sensitive to market movements, and a correlation of 0.41 to the broad-based SPY ETF. TSM has a market cap of $1.06 trillion, classifying it as a Mega Cap stock.Recent news includes TSMC's fourth-quarter profit forecast, which is expected to jump 58% due to strong demand for AI chips. However, the company faces challenges from US tech restrictions on China and potential tariffs from the upcoming US administration. TSMC is also investing $65 billion in new factories in Arizona, USA[2].Analyst ratings show a consensus price target of $203.8 based on the ratings of 6 analysts, with the high being $255 issued by Barclays on January 17, 2025. The average price target of $240 between Barclays, Needham, and Barclays suggests an implied 17.72% upside for TSM[3].TSMC reported a 33.9% rise in net sales for 2024, driven by strong demand for AI technology, and is expected to continue its upward trajectory in 2025. The stock is forecast to trade within a price range of $225.51 to $294.93, with an average price of $247.65 throughout the year[4].Additionally, TSMC is advancing its compact optical engine technology, branded as COUPE, and is prioritizing silicon photonics. The company's Arizona semiconductor fab is preparing to begin mass production, strengthening the local semiconductor supply chain[5].Overall, TSM's recent stock price movements, strong revenue growth driven by AI chip demand, and significant investments in new facilities position it for continued growth in 2025. However, geopolitical tensions and supply chain risks remain challenges for the company.