TSMC shares expected to make rebound after slump

By Ted Chen ,The China Post

TAIPEI, Taiwan — Institutional investors yesterday indicated that they are expecting the share price of TSMC (台積電) to make a swift rebound from an anticipated slump following its dividend payout of NT$3 scheduled on Monday.

TSMC shares yesterday gained NT$2 to close at NT$136.5, despite the conventionally expected slump in share price on the heels of a dividend payout. The company last year also approved to initiate a NT$3 cash dividend payout, and had recovered from the slump in its share price within eight sessions. Securities brokerage firm managers stated that as foreign institutional investors had already unloaded portions of TSMC positions, coupled with a period of downward fluctuation earlier this week, there is a 70- to 80-percent chance that TSMC shares may close with gains on Monday. Market analysts stated that over the past decade, TSMC shares exhibited an 80-percent probability in posting gains on the trading session leading to the company’s dividend payout date. TSMC shares also posted gains averaging at 1.21 percent on the dividend payout date, said the analyst. Analysts added that there is a 70- to 90-percent chance that the company’s share price may gain 2.88 percent to 4.4 percent in the 20-day period following the dividend payout.

Foreign institutional investors, however, on Wednesday unloaded about 16 million TSMC shares, selling about 60 million shares over the six preceding trading sessions, the highest level observed in two months.

TSMC Reports Stellar June Performance Results Meanwhile, TSMC on Thursday reported stellar June revenues of NT$60.344 billion, which, despite a 0.7-percent month-on-month decline, propelled the company’s second-quarter revenues to a record-high NT$183.02 billion, a 23.48-percent quarter-on-quarter improvement. The company in the first half of this year accumulated revenues of about NT$331.236 billion, up by 14.8 percent year-on-year. Company Chairman Morris Chang previously stated that its foundries are expected to run at near capacity throughout the third and fourth quarters of this year, while benefiting from the 3- to 5-percent growth anticipated for the global semiconductor sector. Reports indicate that the company’s 8-inch and 12-inch wafer production lines and 28-nanometer fabrication plants are straining under high demand.

Institutional investors stated that the company’s performance is poised to hit new highs in the future, propelled by manufacturing contracts for Apple’s A9 chipsets. Most notably, yield rate of the company’s 20-nanometer fabrication is expected to rise to 75 percent to 80 percent. In addition, the company is well-positioned to take advantage of revenue growth prospects as new applications emerge for a collection of technologies referred to as the Internet of Things which enables connectivity and Internet-like communication among disparate devices, machines and appliances.