Taiwan Semiconductor Manufacturng Co — Financial Overview, Stock Price, Market Cap

Financial Performance

5Y price score: 363

10Y return: 1,294.2%

DATE RANGE:

ㅤ

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266.8

52-week range

487.4

412.61

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Required return / cost of capital

FCFF terminal growth rate

Your fair value & Margin of safety

To calculate fair value based on cost of capital and terminal growth assumptions above, please select free cash flow forecast.

Forecast:

Valuation

Free Cash Flow Yield

2.2 %

Dividend Yield TTM

1 %

Market cap $

$ 2,139,994

Price / Earnings TTM

26.4

Price / Book TTM

9.9

PEG TTM

0.6

Earnings growth and return

LTM

5YR

10YR

Total return (price & dividends)

38.5 %

267 %

1,294.1 %

Free cash flow per share growth

268.6 %

229.5 %

270.2 %

Earnings per share growth

65.8 %

249.7 %

443.8 %

Founded: 1,987

Employees: 65,152

Business Summary:Taiwan Semiconductor Manufacturing Company Limited manufactures, packages, tests, and sells integrated circuits and other semiconductor devices in Taiwan, China, Europe, the Middle East, Africa, Japan, the United States, and internationally. It provides complementary metal oxide silicon wafer fabrication processes to manufacture logic, mixed-signal, radio frequency, and embedded memory semiconductors. The company also offers customer support, account management, and engineering services, as well as manufactures masks. Its products are used in mobile devices, high performance computing, automotive electronics, and internet of things markets. The company was incorporated in 1987 and is headquartered in Hsinchu City, Taiwan.

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Fair Value Reference Estimate

Latest Earnings Call Takeaways

2026 Q3 (Oct 15, 2026)

1) Financial Highlights and Performance Metrics - Q3 2026 revenue increased 16.2% sequentially to $46.7 billion, exceeding guidance. - Gross margin decreased to 66.4%, down 1.3 percentage points sequentially, primarily due to the ramp-up of 2 nm technology. - Operating margin stood at 58.7%, with EPS at TWD 29.43 and ROE at 45.5%. - Advanced technologies (7 nm and below) accounted for 79% of wafer revenue, with 2 nm contributing 8%.

2) Segment Performance and Demand Drivers - High-Performance Computing (HPC) revenue surged 22% QoQ, making up 68% of total revenue. - Smartphone revenue rose 10% to 21%, while automotive increased 23% to 4%. - Internet of Things (IoT) and Data Center Equipment (DCE) showed modest growth and decline, respectively. - TSMC expects full-year 2026 revenue growth to be around 44% YoY, driven by robust demand for leading-edge technologies.

3) Operational Challenges and Strategic Responses - Margin dilution from the 2 nm technology ramp-up is expected to continue, with guidance for Q4 gross margin between 65% and 67%. - TSMC is expanding its capacity aggressively, with plans for nearly 20 fabs worldwide, including 13 in Taiwan and additional facilities in the U.S. and Japan. - The company is addressing potential power supply constraints and is actively evaluating capacity needs in the U.S. market.

4) Capital Expenditure and Future Outlook - TSMC maintains a capital budget of $60 billion to $64 billion for 2026, with expectations for higher CapEx in the following years to support customer growth. - The company is preparing for significant demand from the AI sector, with a focus on advanced packaging and dual technology tracks. - Gross margin dilution from overseas fabs is expected to widen to 3%-4% in the coming years, reflecting the costs associated with expansion.

5) Guidance and Market Positioning - Q4 2026 revenue guidance is between $52.3 billion and $54.3 billion, indicating a 14% sequential increase. - TSMC is confident in its ability to capture AI-related demand, with a strong focus on technology leadership and customer collaboration. - The transcript lacks specific details on customer contracts and the competitive landscape regarding pricing strategies.

Bottom line: TSMC's strong Q3 performance and robust demand outlook, particularly in AI and HPC, position it well for continued growth. However, the company faces margin pressures from new technology ramps and overseas expansions. Investors should be optimistic about TSMC's strategic capacity investments and commitment to maintaining profitability amidst rising costs.