Taiwan Semiconductor Manufacturing Co. Ltd. (TSM) stock slipped about 2% in premarket trading Thursday as investors pulled back from technology stocks and locked in gains after the stock's strong rally over the past year.

Taiwan Semiconductor Stock Slips

Nasdaq futures were down 1.03%, while S&P 500 futures slipped 0.32%. The weaker market tone pressured semiconductor stocks and other high-growth technology names.

Taiwan Semiconductor shares have gained nearly 116% over the past 12 months. The stock remains near the upper end of its 52-week trading range, prompting some investors to take profits after the recent run higher.

The stock continues to trade below its 52-week high of $450.16. The latest decline appears to be a pullback within a broader uptrend rather than a change in the long-term trend.

CEO Dismisses Competitive Threats

According to a report by Nikkei Asia, Taiwan Semiconductor Chairman and CEO C.C. Wei said Thursday that the company is not concerned about competition from rivals, including Elon Musk's reported plans to build advanced chip manufacturing facilities.

Wei said it would take years to develop cutting-edge semiconductor production capabilities and stressed that the company is "not afraid of competition" from Intel Corporation (Intel) and Samsung Electronics Co., Ltd. (Samsung).

Wei also said the company does not plan to aggressively raise prices despite strong AI-driven chip demand, adding that the company is not like the "memory chip guys" and remains focused on long-term customer relationships, Nikkei Asia reported.

Wei's comments come as reports have suggested Taiwan Semiconductor is considering higher pricing for advanced 3nm chips amid tight AI-related capacity.

Separately, Intel CEO Lip-Bu Tan recently described Taiwan Semiconductor as a "very trusted partnership," reaffirming Intel's reliance on the foundry for advanced chip production while emphasizing collaboration across the industry.

Technical Trend Remains Intact

Despite Thursday's weakness, Taiwan Semiconductor continues to trade above key moving averages.

The stock is 4% above its 20-day simple moving average of $413.41, 11.4% above its 50-day average of $385.65, and 32.5% above its 200-day average of $324.37. This alignment generally signals a bullish trend.

The golden cross that formed in June 2025, when the 50-day moving average moved above the 200-day moving average, remains in place. The stock also continues to hold above both long-term support levels.

Momentum indicators remain constructive. The moving average convergence divergence, or MACD, remains above its signal line, suggesting buying pressure has improved following the stock's earlier pullback.

A key support level sits near $385, which closely aligns with the 50-day moving average. Traders may watch that area if selling pressure continues.

Taiwan Semiconductor Earnings And Analyst Outlook

Investors are looking ahead to the company's next earnings report, which is expected on July 16.

Wall Street expects earnings of $3.69 per share, up from $2.47 a year earlier. Analysts also forecast revenue of $39.76 billion, compared with $30.07 billion in the prior-year period.

The stock trades at about 37.2 times earnings, reflecting a premium valuation relative to many semiconductor peers.

Analysts remain broadly positive on the company. The consensus rating is Buy, with an average price forecast of $420.

Recent analyst actions include:

• Barclays maintained an Overweight rating and raised its price forecast to $470 on April 22.
• DA Davidson maintained a Buy rating and a $450 price forecast on April 17.
• Needham maintained a Buy rating and raised its price forecast to $480 on April 16.

MarketDash Edge Signals Strong Growth But Expensive Valuation

MarketDash Edge rankings highlight strong momentum, growth and quality metrics for Taiwan Semiconductor. Momentum scored 92.27, quality scored 97.55 and growth scored 92.78.

However, the value score of 22.18 suggests the stock trades at a premium valuation. That can increase volatility during periods of weaker market sentiment.

For long-term investors, the combination of strong growth and business quality supports the broader bullish trend. However, valuation remains an important consideration when assessing entry points.

ETF Exposure Adds Another Demand Driver

Taiwan Semiconductor holds significant weightings in several exchange-traded funds, including:

• Harbor International Compounders ETF (OSEA): 7.12% Weight
• Pacific NoS Global EM Equity Active ETF (GEME): 9.98% Weight
• Nicholas Crypto Income ETF (BLOX): 8.20% Weight

Significance: Because TSM carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.

Taiwan Semiconductor Price Action

TSM Stock Price Activity: Taiwan Semiconductor shares were down 2.04% at $427.77 during premarket trading on Thursday, according to market data.