Daiwa Securities: Raises target price of TSMC to 2988 TWD, maintains "buy" rating.

Morgan Stanley's report stated that TSMC's full-year revenue guidance for 2026 is significantly better than expected. The company has raised its revenue growth guidance for 2026 to over 40% year-on-year, up from over 30% previously. Management attributes the upward revision to strong AI demand, despite facing challenges in consumer demand. Cloud service providers are rapidly increasing their cloud capital expenditures. TSMC has not updated its AI semiconductor revenue CAGR forecast, but indicates that actual performance is higher than the previous forecast of 55%-60%. The bank believes that a CAGR of 70% to 80% for TSMC's AI semiconductor business is a reasonable assumption. The bank has raised its target price from 2888 NT dollars to 2988 NT dollars and maintains a "Buy" rating. In a volatile market environment, the company's strong profit-making capability should continue to attract investment, and the upcoming announcement of cloud capital expenditure updates by CSP customers for the second quarter of 2026 will be an important catalyst.