What To Expect From Taiwan Semiconductor Manufacturing's Earnings?

There isn't much of a better bet out there when it comes to the semiconductor industry than Taiwan Semiconductor Manufacturing Company (NYSE: TSM), or TSMC for short. The company is estimated to own 92% of the advanced chip market, which supplies chips for smartphones, automotive artificial intelligence, and supercomputing.

Where can I listen to TSMC's conference call?

Taiwan Semiconductor will report Q4 earnings on January 13, 2022, at 1 AM Eastern Time. To listen in to the call, you can sign up here, or by visiting the company's investor relations page.

What should we expect from TSMC's earnings?

As of yesterday, we can tell it has already been a promising quarter for the chip manufacturer, at least from a revenue perspective. While we don't yet have the full quarterly results, TSMC reports revenue figures each and every month. With the published data compiled from October through to December, TSMC reported revenue of $15.8 billion which marks the sixth consecutive record-beating quarterly results.

We can also highlight the case for TSMC from 2022's Consumer Electronics Show (CES 2022) last week. A focal point from the event was the strategic investments companies are making towards autonomous driving technologies and artificial intelligence following announcements from some of TSMC's largest customers, AMD and Nvidia.

Not to mention, TSMC is the supplier for the largest company in the world, Apple, so demand doesn't look close to slowing down. 

Is TSMC a good investment?

It's easy to forget the magnitude of this company, but it has a commanding lead in its space with monopolistic-like control, all while boasting a massive $648 billion valuation. The power it has in the market is visible too, through price raises of 10% passed on for advanced chips, and 20% price increases for less advanced chips. Even with the current shortage, TSMC's customers are forced to pay the piper. The shortage is a notable risk factor, which the company expects to continue into 2022, but it hopes that the shortfall will lessen by 2023.

With many stocks taking a hammering as of late, TSMC is one that has held up well -- in part, this can be attributable to the companies relatively low P/E of 31, which isn't completely out of whack. With net margins of 37.7% and a healthy dividend of 1.57%, TSMC certainly makes for an interesting opportunity for investors, especially given the growth trajectory ahead of the company.