Taiwan Semiconductor (TSM) stock closed the week trading more than 1% higher while the majority of technology stocks suffered through selling.
The world’s largest semiconductor company, by revenue, announced this morning that its December revenue had increased more than 57% on a year-over-year basis.
News of the monthly revenue comparison comes less than a week before Taiwan Semiconductor’s earnings report on January 16.
In general, semiconductor stocks have given mixed results since October.
The VanEck Vectors Semiconductor ETF (SMH) has lost 2% of its value over the last two months and 11% over the last six. The SMH shares are a proxy for the semiconductor sector’s performance.
Shares of Taiwan Semiconductor have been the second-best performing stock among the top five in the industry by market capitalization over the last three months. Shares of Broadcom (AVGO) are the top performer with returns of 23%.
From a technical perspective, TSM shares maintain a strong intermediate- and long-term trend.
The stock is trading above its bullish 50-day moving average. That trendline trades at $196 and continues to forecast higher prices over the next 4–6-week period.
Continued strength for TSM shares will fall on the company’s earnings report next week.
Investors and analysts expect to see the company report revenue of $26.38 Billion and earnings per share of $2.23. Those numbers would reflect 20% growth from the same period last year. That growth would break the three-quarter streak of rising revenue growth.
Investors should pay attention to the $190 price level ahead and after Taiwan Semi’s earnings report.
The stock has been consolidating across this price with a bullish trend since November. A break below this trend along with an earnings disappointment would see TSM shares target $170.
