Best Income Stocks to Buy for May 22nd

Here are two stocks with buy rank and strong income characteristics for investors to consider today, May 22^nd:

Fortis Inc. FTS: This Canadian electric and gas utility company has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4.2% over the last 60 days.

Fortis Price and Consensus

Fortis price-consensus-chart | Fortis Quote

This Zacks Rank #1 company has a dividend yield of 3.6%, compared with the industry average of 3.1%.

Fortis Dividend Yield (TTM)

Fortis dividend-yield-ttm | Fortis Quote

MGIC Investment Corporation MTG: This mortgage insurance company has witnessed the Zacks Consensus Estimate for its current year earnings increasing 1.8% over the last 60 days.

MGIC Investment Corporation Price and Consensus

MGIC Investment Corporation price-consensus-chart | MGIC Investment Corporation Quote

This Zacks Rank #1 company has a dividend yield of nearly 2%, compared with the industry average of 1.7%.

MGIC Investment Corporation Dividend Yield (TTM)

MGIC Investment Corporation dividend-yield-ttm | MGIC Investment Corporation Quote

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See also <!DOCTYPE html><html lang="en"><head> <meta charset="UTF-8"> <meta http-equiv="X-UA-Compatible" content="IE=edge"> <meta name="viewport" content="width=device-width, initial-scale=1.0"> <title>The Rise of Taiwan Semiconductor Manufacturing Company in the AI Chipmaker World</title></head><body> <h2>Seizing the Chipmaker Crown</h2> <p>As Nvidia dances on the ceiling of the trillion-dollar club, another contender emerges in the AI chipmaking realm. While Broadcom has made strides in networking and AI accelerator chips, it's not the dark horse for the trillion-dollar congregation. Eyes turn to Taiwan Semiconductor Manufacturing Company (TSMC), waiting in the wings to ascend the throne.</p> <img alt="A graphic depicting a circuit board with a chip in the middle labeled AI." src="https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F787324%2Fgettyimages-ai-artificial-intelligence-chip-semiconductor-circuit.jpeg&w=700"> <p class="caption">Image source: Getty Images.</p> <h2>A Mighty Player in the Shadows</h2> <p>TSMC reigns supreme as the largest chip fabricator globally, commanding a lion's share of foundry spending. Armed with cutting-edge chip manufacturing prowess, boasting unmatched power efficiency and computational might, TSMC etches its mark in the AI landscape and beyond.</p> <p>The company's colossal scale fosters a formidable advantage over competitors. Its robust revenue streams fuel relentless investments in research and development, ensuring TSMC stands at the vanguard of chip manufacturing innovation.</p> <h2>Driving Growth on the Semiconductor Highway</h2> <p>Painting a rosy future, TSMC anticipates a fruitful trajectory in the upcoming years. With third-quarter revenue forecasts standing tall at $22.4 billion to $23.2 billion, the company flaunts remarkable year-on-year growth figures. Additionally, a projected increase in gross margin signals pricing resilience amid escalating customer demands.</p> <p>Amidst the backdrop of tech giants doubling down on AI infrastructure, such as Meta Platforms and Alphabet, TSMC stands poised to ride the crest of this technological wave. With an eye on pronounced capex expansions by industry behemoths, TSMC anticipates a windfall of demand for its chipsets.</p> <img alt="A server room with glowing server racks." src="https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F787324%2Fgettyimages-server-room-cloud-computing.jpg&w=700"> <p class="caption">Image source: Getty Images.</p> <p>An air of anticipation looms over the tech sphere as the impending Apple iPhone release promises a host of new AI features. The allure of cutting-edge technology is expected to drive a surge in iPhone upgrades, propelling a ripple effect of chip demand, with TSMC positioned at the helm of this impending surge.</p> <h2>The Valuation Conundrum</h2> <p>Despite TSMC's colossal $875 billion market capitalization, its shares appear undervalued at current prices. Trading at a modest forward price-to-earnings ratio of 26.5, coupled with robust revenue growth and margin expansion, the company is forecasted to sustain earnings growth exceeding 20% annually. Analysts project a steady trajectory of 21.5% earnings growth per annum over the ensuing five years, painting a promising picture for investors.</p></body></html>Avoiding the Bandwagon: An Analysis of Taiwan Semiconductor Manufacturing

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This article originally published on Zacks Investment Research (zacks.com).

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