TSMC stock target raised at Bernstein on more CoWoS

Investing.com -- Bernstein lifted its price target on Taiwan Semiconductor Manufacturing (TSMC) in a note on Monday, pointing to accelerating advanced packaging demand tied to artificial intelligence.

The firm now sees TSMC reaching NT$1,800 per share, up from NT$1,444, and $330 in U.S. ADR terms, while reiterating an Outperform rating.

Analyst Mark Li writes that “more CoWoS, more XPU & 23% revenue growth in 2026” underpins the higher target.

Bernstein now expects TSMC’s CoWoS (chip-on-wafer-on-substrate) capacity to reach 125,000 wafers per month exiting 2026, with total industry CoWoS capacity of around 1.25 million units per year when including OSATs.

That level, the note argues, will be “roughly just enough to support projects announced recently (e.g. US$0.5T from Blackwell & Rubin for NVIDIA in 2025 & 2026) but not much more.”

Beyond AI accelerators, Bernstein sees support from “N2 & price hike on N3/5” for smartphones and improving mature-node demand, and now forecasts TSMC revenue to grow 23% this year and 20% in 2027.

Despite heavy investment, the firm models only a “mild margin dip” of about 150 basis points over two years, with EPS growing at 20% CAGR in 2026 & 2027.

On the longer-term AI buildout, Bernstein estimates it will take 55–60GW of AI data center buildup from now to 2029 for TSMC to expand AI revenue at a “mid-40% CAGR,” a level the analyst says appears achievable relative to external energy forecasts.

Capex is modeled at $47 billion next year, with spending shifting toward N2 as mobile moves to that node, helping “revenue grow faster & reduce the capex/revenue ratio over time.”

Bernstein concludes it views TSMC as “a quality compounder and a core holding for investors.”

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