Watch semiconductor companies this week, after Taiwan Semiconductor (TSM) lifted the sector.
Last week, TSM posted revenue and adjusted earnings per share that beat expectations. Cash flow was so strong that the firm hiked its dividend by 20%, to NT$6.00 (US $0.95 a share). Although investors are not holding TSM stock for its dividend, the modest payout strengthens shareholder confidence in the chip manufacturer.
In the beaten-up telecom sector, Verizon Communications (VZ) risks falling to multi-year lows. The stock closed at $38.91, below the $40 level. On January 14, the firm experienced an outage, as did AT&T (T) and T-Mobile (TMUS). This hurt Verizon the most, with 540,000 customers affected. Around 5,000 customers were affected by AT&T and T-Mobile services.
The outage is a reminder that telecom is both critical and fragile. People need telecom services more than they need AI. Yet investments in AI are growing yearly, despite any proof that it is critical.
In the electric vehicle industry, Rivian (RIVN)’s rally is unwinding. Shares peaked at around $22 before closing at $16.67 last Friday. Analysts at UBS warned that Rivian has limited catalysts related to self-driving technology. Still, Tesla (TSLA) trades at breathtaking valuations even as quarterly EV sales drop. The firm does not have self-driving, cybercabs, robotics, or AI offerings that would justify the TSLA stock premium.
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