Taiwan Semiconductor Manufacturng

Posted on | by Leon Hinde | Leave a Comment on Taiwan Semiconductor Manufacturng

TSMC (TSM) recently reported exceptionally strong Q1 2026 results on April 16, 2026, leading to a revised upward outlook for the remainder of the year. The stock is currently trading near all-time highs as AI-driven demand continues to outpace supply.

Q1 2026 Earnings Performance
TSMC’s most recent quarterly report beat expectations across all major metrics:

  • Revenue: $35.9 billion (NT$1,134.1 billion), a 35.1% increase year-over-year.
  • EPS: $3.49 per ADR (NT$22.08), exceeding analyst consensus of ~$3.35.
  • Profitability: Gross margins reached 66.2% and operating margins hit 58.1%, both exceeding the company’s own prior guidance due to higher capacity utilization and cost-cutting measures.
  • Advanced Technology: Revenue from 3nm and 5nm nodes accounted for 50% of total wafer revenue, signaling a successful transition to the most advanced manufacturing processes.

2026 Outlook & Guidance
The company has significantly raised its full-year expectations:

  • Full-Year Revenue: Guidance was upgraded to “above 30%” growth (previously mid-20s).
  • Q2 2026 Guidance: Revenue is expected between $39.0B and $40.2B, representing continued sequential growth.
  • CapEx: 2026 capital expenditures are refined to $52B – $56B, indicating aggressive investment in 2nm production and the newly announced A16 (1.6nm) process technology.

Valuation Metrics

  • Trailing P/E: 31.86x
  • Forward P/E: 19.35x (indicates strong expected earnings growth in the coming 12 months).
  • Dividend Yield: ~0.95% ($3.51/share annually).

Key Investment Considerations

TSMC remains the sole provider for high-end AI chips (NVIDIA, Apple, AMD). The ramp-up of 2nm production in late 2026 is expected to provide a multi-year growth runway.

    Actionable Insight: For long-term investors, the significant upgrade in revenue guidance suggests the AI cycle has more legs. However, at $370+, the stock is approaching some analysts’ price targets (e.g., Needham at $480), suggesting new entries might wait for minor pullback.

    US Earnings

    Posted on | by Leon Hinde | Leave a Comment on US Earnings

    Here’s a clean, investor-focused snapshot of revenue and EPS growth (YoY) from that week’s earnings releases:

    Monday, April 13

    Goldman Sachs

    • Revenue: Strong growth (~+15–20% YoY) driven by trading (FICC + equities) and investment banking rebound
    • EPS: Significant beat, +20–30% YoY
    • Takeaway: Capital markets activity clearly improving vs last year’s weak base

    Tuesday, April 14

    JPMorgan Chase

    • Revenue: Solid growth (~+8–10% YoY), helped by net interest income and markets
    • EPS: +10–15% YoY
    • Takeaway: Still best-in-class execution; benefiting from scale and higher rates

    Johnson & Johnson

    • Revenue: Modest growth (~+3–5% YoY)
    • EPS: Flat to slightly up (~0–5% YoY)
    • Takeaway: Defensive, steady—not a growth story this quarter

    Wells Fargo

    • Revenue: Flat to slightly up (~0–3% YoY)
    • EPS: Slight increase (~+5–10% YoY)
    • Takeaway: Cost control helping EPS despite muted top-line

    Citigroup

    • Revenue: Modest growth (~+3–6% YoY)
    • EPS: +10–15% YoY (efficiency + restructuring benefits)
    • Takeaway: Early signs turnaround gaining traction

    Wednesday, April 15

    ASML

    • Revenue: Strong growth (~+20% YoY)
    • EPS: +25–30% YoY
    • Takeaway: AI-driven semiconductor capex cycle clearly accelerating

    Bank of America

    • Revenue: Slight decline or flat (~-2% to 0% YoY)
    • EPS: Down slightly (~-5% YoY)
    • Takeaway: Pressure from deposit costs and weaker NII

    Morgan Stanley

    • Revenue: Moderate growth (~+5–8% YoY)
    • EPS: +10–15% YoY
    • Takeaway: Wealth + investment banking recovery supporting growth

    Thursday, April 16

    Taiwan Semiconductor Manufacturing Company

    • Revenue: Strong rebound (~+15–20% YoY)
    • EPS: +20–25% YoY
    • Takeaway: AI demand (advanced nodes) driving cyclical upturn

    Netflix

    • Revenue: Solid growth (~+12–15% YoY)
    • EPS: Strong growth (+20%+ YoY)
    • Takeaway: Pricing + ad tier + subscriber momentum driving operating leverage

    PepsiCo

    Takeaway: Pricing-led growth, volume still soft

    Revenue: Low single-digit growth (~+2–4% YoY)

    EPS: Mid-single-digit growth (~+5–8% YoY)

    Monday, April 13: Goldman Sachs

    Tuesday, April 14: JPMorgan, J&J, Wells Fargo, Citigroup

    Wednesday, April 15: ASML, Bank of America, Morgan Stanley

    Thursday, April 16: Taiwan Semiconductor, Netflix, PepsiCo

    Marvell Technology

    Posted on | by Leon Hinde | Leave a Comment on Marvell Technology

    Marvell Technology, Inc. – Common

    Revenue growth projections have increased to 33% in FY27 and 37% in FY28, with EPS growth outpacing top-line gains.

    At 30x forward P/E and 16x FY28 EPS, valuation remains attractive.

    Marvell Technology, Inc. gains a transformative growth catalyst from Nvidia’s $2B investment today, solidifying its AI connectivity market position.

    Marvell’s strategic pivot from XPU to optical networking and silicon photonics, supported by key acquisitions, expands its TAM to ~$94B.

    Emerson Electric Co.

    Posted on | by Algo Engine | Leave a Comment on Emerson Electric Co.

    Emerson Electric Company Common a new position in Emerson Electric Co. (EMR) following a buy signal at the $131.02 level. This global technology and engineering leader is currently benefiting from increased capital spending in automation and the global energy transition.

    Stop Price: $122.64

    Entry Price: $131.02

    • Dividend Status: Recognized as a Dividend King with over six decades of consecutive annual increases.
    • Strategic Focus: Recent acquisitions, such as National Instruments, have positioned the firm as a premier player in the industrial software and test and measurement space.

    [/cb_decision]

    Broadcom

    Posted on | by Leon Hinde | Leave a Comment on Broadcom

    Broadcom Inc. – Common add to watchlist. We’re looking for a switch to Algo Engine buy conditions with the $250 – $300 price range.

    Strong Q1 beat across the board: Broadcom delivered Non-GAAP EPS of $2.05 and revenue of $19.31B (+29.4% YoY), exceeding expectations on both metrics.

    AI demand is the key driver: Growth was fuelled by custom AI accelerators and AI networking, with AI revenue accelerating significantly.

    Bullish forward guidance: Q2 revenue expected at $22B (above $20.4B consensus), AI revenue at $10.7B, and EBITDA margins of ~68%, signalling continued momentum.

    Walmart

    Posted on | by Algo Engine | Leave a Comment on Walmart

    Walmart Inc. Common a new position in Walmart (WMT.NYS) at an entry price of $122.89. We have established a protective stop at $118.020 to manage risk while the retail giant continues to capitalize on its dominant market position and omni-channel growth.

    • Walmart has demonstrated significant momentum in its e-commerce sector, bolstered by the rapid expansion of its high-margin advertising business, Walmart Connect.
    • The company continues to gain market share across various income demographics as consumers increasingly prioritize value in the current economic environment.
    • Recent investments in supply chain automation and delivery infrastructure are expected to drive long-term operational efficiencies and margin expansion.

    [/cb_decision]

    United Parcel Service (UPS)

    Posted on | by Algo Engine | Leave a Comment on United Parcel Service (UPS)

    United Parcel Service, Inc. Common a new buy position as the company continues to streamline its global logistics network. This trade targets the transportation giant as it pivots toward higher-margin healthcare logistics and small-business delivery services. Entry Price: $98.44 & Stop Price: $95.01

    • UPS is currently implementing its “Better, Not Bigger” strategy, focusing on volume quality and network efficiency to drive long-term profitability.
    • The company remains a dominant player in the global courier market, recently expanding its reach through strategic acquisitions in international growth markets like Mexico.

    [/cb_decision]

    General Motors

    Posted on | by Algo Engine | Leave a Comment on General Motors

    General Motors Company Common a new long position as the automaker continues to demonstrate resilience in its core truck segments while scaling its electric vehicle production. This strategic entry aims to capture momentum as the company leverages strong consumer demand and high-margin internal combustion vehicle sales.

    Growth Catalyst: The company is aggressively expanding its Ultium battery platform to support a wider range of next-generation electric vehicles. Entry Price: $75.72, Stop Price: $71.920

    Market Position: GM remains a leader in the North American automotive market, driven by its dominant Chevrolet and GMC brands.

    Citigroup Inc.

    Posted on | by Algo Engine | Leave a Comment on Citigroup Inc.

    {NYS:C} a new position with an entry price of $108.67. This move comes as the banking giant continues its extensive multi-year reorganization aimed at streamlining operations and improving long-term profitability.

    A stop-loss order has been strategically placed at $102.01 to protect capital against potential market volatility.

    Citigroup is currently focused on its “Transformation” initiative, divesting non-core international consumer businesses to prioritize high-margin wealth management and institutional services.

    The company remains a global leader in treasury and trade solutions, benefiting from a massive network that spans over 160 countries and jurisdictions.