Equity Long-Short, Semiconductors, Fabricated Knowledge

Douglas O'Laughlin

Equity Long-Short, Semiconductors

Fabricated Knowledge

Learn more about the world's most important manufactured product. Meaningful insight, timely analysis, and an occasional investment idea.

Equity Bottom-Up

Taiwan Semiconductor (TSMC) - ADR / Equity Bottom-Up

<ul><li>It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.</li><li>TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.</li><li>First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.</li></ul>

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.TSM revenue is above guidance, gross margins are a bit ahead of the midpoint, and operating margins are at the high end of guidance.First, while this is a good result, semiconductors are due for a correction. I wrote about this in March, and SOXX has quietly crept downwards since then.

TSMC, ASML, VAT Group, and Alphawave Earnings

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

<ul>
<li>TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.</li>
<li>TSMC guided for strong growth not just in 2024E, but if one digs into management's comments, they actually provided strong visibility into their 2028E internal revenue expectations.</li>
<li>For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.</li>
</ul>


TSMC and ASML reported 1Q24 results last week; both stocks have fallen post results, impacted by global concerns despite a strong outlook for these two leaders into 2025E.
TSMC guided for strong growth not just in 2024E, but if one digs into management's comments, they actually provided strong visibility into their 2028E internal revenue expectations.
For ASML, its EUV product business is the key indicator to watch. We believe TSMC shares will continue to re-rate even through a period of global economic softness.


TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

Taiwan Tech Focused Senior Analyst

Patrick Liao

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)</a>'s 2Q24F outlook is experiencing a slight upward now, possibly indicating a positive QoQ.  </li>
<li>UMC's notable contributors are showing a mixed outlook, and <a href="https://www.smartkarma.com/entities/novatek-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:10904:1" rel="noopener">Novatek Microelectronics Corp (3034 TT)</a> could be the most influencer.</li>
<li>Attention should be paid to the 3Q24F outlook for any potential changes and a shift from a bearish view could positively impact the outlook, potentially signaling the end of downturn.  </li>
</ul>



United Microelectronics Corp (2303 TT)'s 2Q24F outlook is experiencing a slight upward now, possibly indicating a positive QoQ.  
UMC's notable contributors are showing a mixed outlook, and Novatek Microelectronics Corp (3034 TT) could be the most influencer.
Attention should be paid to the 3Q24F outlook for any potential changes and a shift from a bearish view could positively impact the outlook, potentially signaling the end of downturn.  


UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

<ul>
<li>
Investing in semiconductors can be pretty simple if you let it be.
</li>
<li>
At a high level, I believe you want to invest in the secular at a decent price or invest in places where there are unwarranted dislocations.
</li>
<li>
Sometimes the entire ecosystem says one thing and the stocks say another. Usually, the ecosystem is right.

</li>
</ul>



Investing in semiconductors can be pretty simple if you let it be.


At a high level, I believe you want to invest in the secular at a decent price or invest in places where there are unwarranted dislocations.


Sometimes the entire ecosystem says one thing and the stocks say another. Usually, the ecosystem is right.




Taiwan Semiconductor (TSMC) / Equity Bottom-Up

<ul>
<li>Nvidia GTC Conference This Week Likely to Create Newsflow for Many Tech Names</li>
<li>Samsung Could Hike NAND Flash Prices by 20%; Silicon Motion for Exposure</li>
<li>TSMC Reportedly Placing Orders for Additional Advanced Packaging Capacity, Likely In Response to Demand Strength</li>
</ul>


Nvidia GTC Conference This Week Likely to Create Newsflow for Many Tech Names
Samsung Could Hike NAND Flash Prices by 20%; Silicon Motion for Exposure
TSMC Reportedly Placing Orders for Additional Advanced Packaging Capacity, Likely In Response to Demand Strength


Taiwan Tech Weekly: Nvidia Conference; Samsung to Hike NAND Prices; TSMC Adding Capex Due to Demand

South Korea

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

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Samsung Electronics (005930 KS)

TSMC, ASML, VAT Group, and Alphawave Earnings

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.

Fabricated Knowledge

TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

If you dig into the details, TSMC provided substantial insight into the company's internal estimates for long-term revenue. For ASML, we discuss...

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Patrick Liao

Why HBM is the Hottest Thing in Memory

Micron's earnings is just a rehash of what I already talked about. Memory pricing increase is driven by HBM shifting the mix of investment there,...

Fabricated Knowledge

Taiwan Tech Weekly: Nvidia Conference; Samsung to Hike NAND Prices; TSMC Adding Capex Due to Demand

Many Taiwanese companies participating at Nvidia's GTC conference this week. Local reports say Samsung to hike NAND flash prices by 20%. Also,...

Vincent Fernando, CFA

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Market Cap (USDm)

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TSMC, ASML, VAT Group, and Alphawave Earnings

It’s time for the main event: earnings are upon us. As is customary, let’s start with TSMC, move to ASML and Alphawave, and then discuss VAT Group.

Fabricated Knowledge

TSMC Just Provided Substantial Visibility into Their Long-Term Growth Estimate; ASML Adds Color

If you dig into the details, TSMC provided substantial insight into the company's internal estimates for long-term revenue. For ASML, we discuss...

Vincent Fernando, CFA

UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ.

​UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Patrick Liao

Why HBM is the Hottest Thing in Memory

Micron's earnings is just a rehash of what I already talked about. Memory pricing increase is driven by HBM shifting the mix of investment there,...

Fabricated Knowledge

Taiwan Tech Weekly: Nvidia Conference; Samsung to Hike NAND Prices; TSMC Adding Capex Due to Demand

​Many Taiwanese companies participating at Nvidia's GTC conference this week. Local reports say Samsung to hike NAND flash prices by 20%. Also,...

Vincent Fernando, CFA

UMC's 2Q24F outlook is slightly improving, with Novatek Microelectronics Corp potentially being a key influencer. Keep an eye on the 3Q24F outlook...

Many Taiwanese companies participating at Nvidia's GTC conference this week. Local reports say Samsung to hike NAND flash prices by 20%. Also,...