Taiwan Semiconductor Manufacturing Unusual Options Activity
Taiwan Semiconductor Manufacturing Company Limited (TSM), together with its subsidiaries, engages in manufacturing, selling, packaging, testing, and computer-aided design of integrated circuits and other semiconductor devices.
(TSM) is the world’s largest manufacturer of semiconductors. TSM has been involved with chip design since the 1980s and today produces chips for some of the largest clients in the world. One such company is Apple. TMS produces chips for Apple and gets 20% of its sales from Apple.
In the Fall of 2019, Apple reportedly boosted component orders for the iPhone 11. In particular, Apple bumped up orders for the $699 iPhone 11 and the $999 iPhone 11 Pro. Taiwan Semiconductor Manufacturing (TSM) saw healthy sales growth that November thanks to strong demand for smartphone processors. Sales rose 1.7% from the previous month and popped 9.7% year over year in 2019.
In October, Apple unveiled iPhone 12 and iPhone 12 mini with 5G technology with 5G capability. The newly designed iPhone 12 models feature expansive edge-to-edge Super Retina XDR displays for a brighter, more immersive viewing experience, and a new Ceramic Shield front cover.
On Tuesday, Nikkei Asia reported that the powerful tech company aims to manufacture as many as 96 million of its signature phones in the first half of next year. It cited "multiple people familiar with the matter" as sources.
The production increase would involve more than just Apple's recently launched iPhone 12 line. The article's sources said that the company would also produce the older iPhone 11 and SE models in this manufacturing round, presumably to satisfy increased demand from more budget-oriented consumers.
Per Nikkei, a provisional full-year forecast that Apple provided its suppliers suggests it's aiming for total production of as many as 230 million iPhones in 2021. If reached, that number would be 20% higher than the 2019 tally.
So what did the Smart Money do today, they bought over 12, 000 call options at the $115 strike price that expires on 12/31?
I'm already long AMD via options, I take a look at the TSMC options decide to jump in with the Smart Money or not in the money.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
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I feel the growth of the company is still not yet at the optimal level. With apple producing more than a phone each year and their technology being in use, it's only going to be more shoot in rate of sales come next year
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Cirrus Logic and Skyworks Solutions will benefit too.
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