Options market betting on good financial report, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR(TSM.US) stock price bullish sentiment rises to a six-month high.

As optimism grows that the upcoming financial reports may alleviate concerns in the market, options traders are betting on Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) stock to continue rising. Data shows that the cost of hedging against a potential drop in Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR stock price has dropped to the lowest level since January. Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR reported better-than-expected quarterly revenue growth last week. Analysts currently expect Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR to raise its full-year guidance when it releases detailed financial reports on Thursday, hinting at potential future price increases. Since hitting a low point in April after the US imposed tariffs, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR stock listed in Taiwan has risen by 44%, partly following the rebound of its key customer NVIDIA Corporation (NVDA.US) stock price. Meanwhile, its American Depositary Receipts (ADR) have risen by nearly 70%, reaching a historical high, reflecting the increasing importance of Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR in the semiconductor industry in the eyes of global investors. The resurgence of the artificial intelligence (AI) theme is boosting Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR stock price. Earlier this year, concerns were raised about its high-cost investments in the US and worries about a potential decrease in demand for high-end chips due to external factors like DeepSeek. However, high-end chips are the main area of focus for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR. Kevin Wang, a director at Nomura Securities, said: "Although there are still some concerns, such as tariff issues or uncertainty about profit margins, overall, I believe that Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR will outperform the market in the second half of the year. It will continue to raise prices for advanced processes, as it has no competitors." Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's revenue growth target for 2025 was previously set at "mid-20s", but bullish analysts believe this target is too conservative considering the strong AI spending. NVIDIA Corporation recently became the first company in history to surpass a market value of $400 billion, mainly due to increased capital expenditures from its largest customer in the coming year. Analysts at Morgan Stanley, including Charlie Chan, wrote in a report this week: "We expect Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR to raise its 2025 revenue guidance to a high single-digit growth of 20% year-over-year in the earnings report, as AI demand continues to outstrip supply. Given the market's low expectations, we recommend buying before the earnings release on July 17." Overall, bullish sentiments are maintained by sell-side institutions, with at least six brokerage firms (including HSBC HOLDINGS and Deutsche Bank Aktiengesellschaft) raising their target price for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR after its sales data was released. Analysts on average expect Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's stock price to rise by 11% above Wednesday's closing price in the next year. There are also some unfavorable factors to consider, such as the recent strength of the New Taiwan Dollar putting pressure on the company's profit margins. In addition, non-AI-related businesses (such as smartphones and personal computers) continue to be weak, while investments in low-profit factories in the US are still increasing. However, the ongoing enthusiasm for AI investments from global companies, as well as the continuous recognition of Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR among global investors, bode well for its future. Another positive factor that could boost Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's stock price is that foreign ownership levels are still much lower than the peak in 2024. Analyst Phelix Lee from Morningstar commented, "The market still favors AI-related stocks." He added that although fluctuations in foreign exchange rates may lead to a 2-3 percentage point drop in gross profit margin for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's June quarter, the company should be able to offset this impact through future price increases.