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Pure-Play Semiconductor Foundries Portfolio UP 5% MTD Thanks To TSM’s +7% - ARCHIVED

Envato AI Generated View of a face on a Circuit Board representing Semiconductor Foundaries Portfolio

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An Introduction

A semiconductor foundry (also known as a fabrication or “fab” plant) does not create its own integrated circuit (computer chip/semiconductor) products but, instead, concentrates all its efforts in the manufacturing of chips based on designs provided by other semiconductor companies which allows it to specialize in manufacturing processes and technologies. Before proceeding listen to the MunAiMarkets theme song and get in the mood to join the rich man’s world!

A voronoi of the global semiconductor revenue industry by revenue distribution

There are only 4 pure-play semiconductor foundry companies trading on U.S. stock exchanges and below is how they have performed so far in 2025, in descending order, and for all of 2025 and the reasons for their prices changes MTD.

Pure-Play Semiconductor Foundries Portfolio: UP 5.0% MTD; UP 46.6% in 2024

  1. Taiwan Semiconductor (TSM): UP 7.1% MTD; UP 89.9% in 2024
    • Reasons For Price Change:
      1. Strong Earnings Report: TSMC reported impressive quarterly results, solidly ahead of analyst consensus estimates, with revenue climbing 37% to $26.9 billion and earnings per American depositary receipt (ADR) soaring 56% to $2.24.
      2. AI-Driven Growth: High-performance computing (HPC) accounted for 53% of TSMC’s revenue in the quarter, with AI chips playing a significant role. The demand for AI accelerators continues to drive growth for the company.
      3. Positive Guidance: TSMC provided upbeat guidance for the first quarter of 2025, forecasting revenue between $25 billion and $25.8 billion, representing about 35% year-over-year growth.
      4. Market Sentiment: The strong earnings report and positive outlook attracted large volume buying, pushing the stock to near-record highs.
  2. Tower Semiconductor (TSEM): UP 2.1% MTD; UP 68.8% in 2024
    • Reasons For Price Change:
      1. Strong Earnings Report: Tower Semiconductor reported impressive quarterly results, with earnings per share (EPS) of $0.57, surpassing analysts’ consensus estimates of $0.45. This positive earnings report boosted investor confidence.
      2. Positive Analyst Ratings: Analysts from firms like Benchmark and Susquehanna maintained “Strong Buy” ratings and raised their price targets. This positive sentiment from analysts contributed to the stock’s rise.
      3. Market Sentiment: The overall positive sentiment in the tech sector and the broader market also played a role in the stock’s performance.
  3. GlobalFoundries (GFS): UP 0.4% MTD; DOWN 29.2% in 2024
    • Reasons For Price Change:
      1. Analyst Downgrades: Several analysts downgraded their ratings for GFS. For example, Morgan Stanley downgraded the stock from “Overweight” to “Equal Weight,” and Susquehanna cut their price objective from $50.00 to $48.00.
      2. Revenue Concerns: Analysts expressed concerns about GlobalFoundries’ revenue growth prospects, which impacted investor sentiment.
  4. United Microelectronics (UMC): DOWN 3.2% MTD; DOWN  23.3% in 2024
    • Reasons For Price Change:
      1. Analyst Downgrades: Several analysts downgraded their ratings for UMC. For example, JP Morgan downgraded the stock from “Buy” to “Hold,” and Goldman Sachs downgraded from “Strong Buy” to “Hold.”
      2. Revenue Concerns: Analysts expressed concerns about UMC’s revenue growth prospects, which impacted investor sentiment.

 

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