Taiwan Semiconductor Manufacturing Company Limited
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
TSMC remains a buy after Q3 2026 revenue surged 50.9% YoY to TWD 1.49T with EPS of TWD 147.15, beating consensus by 3.4% — the latest in an unbroken streak of earnings beats and record quarters driven by AI accelerator demand that management says still far exceeds supply.
The stock has pulled back to $412.61, below its 50-day MA of $434.36 with an oversold RSI of 34.17, offering an attractive entry for a company trading at a P/E of 24.63 and an EV/EBITDA of 16.39 — a 60.3% discount to the peer median. A cluster buy by 30 insiders between September 7 and October 7, 2026 reinforces conviction, though deteriorating smart money flows (score -0.42 as of the quarter ended 30 Jun) and FY2025 CapEx of TWD 1.28T against FCF of TWD 992B warrant monitoring.
What could go wrong
- Geopolitical concentration. The bulk of TSMC's advanced fabrication capacity remains in Taiwan, exposing the stock to cross-strait tensions that could materially disrupt operations and valuation irrespective of fundamentals.
- CapEx intensity compressing FCF. FY2025 capital expenditure of TWD 1.28T against free cash flow of TWD 992B leaves a thin FCF margin of 25.8%; further acceleration in spending could pressure shareholder returns.
- Smart money outflows. Smart money score deteriorated to -0.42 as of the quarter ended 30 Jun from +0.03 the prior quarter, suggesting institutional positioning may be turning cautious even as fundamentals accelerate.
- Cyclical AI demand normalization. Management states AI demand far exceeds supply, but any slowdown in hyperscaler capex could rapidly compress the elevated growth rates priced into the stock.
What would change my mind
Where this comes from: Q3 2026 results · earnings vs estimates, 15 Oct · technicals, 16 Oct · peer comparison. Orin's read on TSM; not advice.
How has the share price moved?
Up 46.5% over twelve months, from $298.25 on 27 Oct 2025 to $436.87 at the Tue 27 Oct 2026 close. Its highest close in that time was $485.80 on 5 Oct 2026; the last close is 10.1% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 42.2M, on 15 Jan 2026).
On file
All TSM filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| FMR | $28.1B | 1.2% |
| Capital World Investors | $16.4B | 1.9% |
| JPMorgan Chase | $10.8B | 0.6% |
| BlackRock | $9.6B | 0.1% |
| Goldman Sachs Group | $7.7B | 0.7% |
| Morgan Stanley | $7.6B | 0.4% |
| Bank of America | $7.3B | 0.5% |
| T. Rowe Price Associates | $5.4B | 0.5% |
| Capital Research Global Investors | $5.0B | 0.7% |
| Massachusetts Financial Services | $4.7B | 1.5% |
239 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 280 Form 4 filings; open-market trades net −$11.0M. Of the 50 on hand, 50 were open-market purchases and 0 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about TSM
Orin answers questions about TSM from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 24.4× its last 12 months of profit (Tue 27 Oct close) — higher than in 2 of its last 5 fiscal years (middle 28.1×); the typical Technology company on the NYSE is at 39.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 24.4×below usual | 28.1× | 39.5× |
| P/S | 12.6×above usual | 10.9× | — |
| EV/EBITDA | 16.3×near usual | 15.5× | — |
| P/B | 8.9×above usual | 7.9× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $586 (from $500 to $700) — 34% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$586
$500 – $700 · +34% against the last close
- 7 buy or overweight
- 1 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 24.4× its last 12 months of profit. Only 2 of the 3 companies it is compared to made a profit (TSEM 71.6×, UMC 19.1×), so there is no typical P/E.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| TSMTaiwan Semiconductor Manufacturing Company Limited | $2.27T | 24.4× | 16.3× | 65.8% | 51.5% | 41% |
| INTCIntel Corporation | $496B | lost money | 145× | 38.9% | −19.8% | −11% |
| TSEMTower Semiconductor Ltd. | $21B | 71.6× | 36.5× | 26.9% | 16.9% | 10% |
| UMCUnited Microelectronics Corporation | $49B | 19.1× | 9.9× | 30.6% | 33.3% | 21% |
- INTC: lost money over the last 12 months, so no P/E.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 24.4× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now24.4×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Technology companies on the NYSE were priced at a typical 39.5× their yearly profit (Tue 27 Oct close).
- Now39.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.