Morgan Stanley: Raises TSMC’s target price to 2,988 New Taiwan dollars, maintains a “Buy” rating

Deep Tide TechFlow message. On July 17, according to Kechuangban Daily, Morgan Stanley published a report stating that TSMC’s full-year 2026 revenue guidance is significantly better than expected. The company has raised its 2026 revenue growth guidance to over 40% year over year, from previously over 30%. Management attributed the upgrade to strong AI demand, despite challenges in consumer demand. CSP customers are rapidly increasing their cloud capital expenditures.

TSMC has not updated its forecast for AI semiconductor revenue CAGR, but said that its actual performance is higher than the prior forecast of 55%-60%. The firm believes that a CAGR of 70% to 80% for TSMC’s AI semiconductor business is a reasonable assumption. The firm raised its target price from NT$2,888 to NT$2,988 and maintained a “Hold” rating. In a volatile market environment, the company’s high-quality profitability should continue to attract capital inflows; next, the update from CSP customers on their cloud capital expenditures for the second quarter of 2026 will be an important catalyst.