The Taiwan Semi Tell?

$NVDA will answer the call shortly!

Taiwan Semi reported their April sales on Friday which grew 21% month to month to $236 billion TW. The six year average from March to April for TSM is flat month to month. Growing this much sequentially (and up 60% year-over-year) is eye opening for a few reasons beyond the obvious. First, the year-over-year growth rate the past 4 months has jumped from 8% in January to 11% in February, 34% in March and 60% in April. Next, HPC (or high performance computing) is almost half of TSM sales, so we can correlate this with Nvidia and its GPU customers quite closely. Also, remember the March quarter reports from the big tech companies already told us their guidance for the June quarter, so this is a new data point particularly for quarter end reporter Nvidia (reports May 22nd). TSM rallied 5% on Friday but didn’t elicit the same reaction in Nvidia shares or other semiconductors tied to TSM. Therein lies the opportunity?

In fact, Wells Fargo on Friday shared an interesting analysis: