Taiwan Semiconductor Manufacturing Company Limited (TSM) AI Stock Analysis

Taiwan Semiconductor Manufacturing Company Limited (TSMC) is a global semiconductor foundry headquartered in Hsinchu City, Taiwan. Founded in 1987, the company specializes in manufacturing, packaging, testing, and selling integrated circuits and semiconductor devices. It operates advanced complementary metal oxide silicon (CMOS) wafer fabrication processes producing logic, mixed-signal, radio frequency, and embedded memory products. These chips support mobile devices, high-performance computing, automotive electronics, and the internet of things. TSMC also delivers mask manufacturing services, engineering support, and account management across operations in Taiwan, China, Europe, the Middle East, Africa, Japan, and the United States.

TSMC expanded revenue from $1.59T in FY2021 to $3.85T in FY2025, achieving a 5-year revenue CAGR of 23.5%. After a 4.5% revenue decline in FY2023, sales rebounded 33.9% in FY2024 and 33.0% in FY2025. Operating margin rose from 40.9% in FY2021 to 50.8% in FY2025, while net margin reached 45.1% in FY2025 with net income of $1.74T and diluted EPS of $10.65. Over the trailing twelve months, revenue stood at $4.94T with EPS of $15.43. For the latest quarter ended September 30, 2026, quarterly revenue grew 50.9% year-over-year and quarterly earnings rose 68.7%.

As of September 30, 2026, TSMC held $4.01T in cash and short-term investments against total debt of $981.30B, resulting in a net cash position of $3.03T. Shareholders' equity was $6.98T against total assets of $10.03T, supporting a current ratio of 2.58 and a debt-to-equity ratio of 0.14. In FY2025, operating cash flow reached $2.27T, funding $1.28T in capital expenditures and generating $992.42B in free cash flow. Cash outflows included $466.78B in dividends paid, while the 5-year share count change was 0.0%.

TSM closed at $412.61 on October 16, 2026, representing a market capitalization of $2.14T and an enterprise value of $1.93T. Its trailing P/E of 26.7x sits below the 28.1x median of its US-listed Technology peers, while its forward P/E of 21.4x is above the peer median of 18.8x. TSMC trades at an EV/EBITDA of 18.2x compared to the peer median of 16.6x, and a PEG ratio of 0.86. Over the past year, TSM gained 38.9% versus 16.8% for the S&P 500, and returned 287.1% over 5 years compared to 83.0% for the index.

TSM pays a quarterly dividend with an annualized forward payout of $3.77 per share, yielding 0.91%. Its payout ratio is 18.6%, and the company has paid dividends for 23 consecutive years. Over the past 5 years, dividends grew at an annualized rate of 9.2%. The last ex-dividend date was December 10, 2026.

Wall Street coverage includes 14 Strong Buy, 6 Buy, and 1 Hold ratings, with no Sell or Strong Sell recommendations. The mean price target is $584.39, representing a 41.6% premium over the last close of $412.61. For the fiscal year ending December 31, 2026, analysts estimate EPS of $17.50 on revenue of $5.56T. For the following fiscal year, 13 analysts project EPS of $23.39 and revenue of $7.65T. The company has beaten EPS estimates in each of the last 4 quarters.

This page is an AI-written research summary of Taiwan Semiconductor Manufacturing Company Limited (TSM). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

Related: TSM income statement, TSM balance sheet, TSM key metrics, TSM analyst forecast, TSM chart. See the TSM stock overview for the latest quote and news.