TSM · Intrinsic value
Is Taiwan Semiconductor Manufacturing Company Limited (TSM) overvalued or undervalued?
As of Oct 20, 2026, TickerWorth publishes a fair-value range of $504.78 – $504.78 for Taiwan Semiconductor Manufacturing Company Limited (TSM), against the delayed market price of $420.22: priced below our range. It is a range, not a single number, so we do not call it over- or undervalued. It is a model estimate; every input is sourced below.
Model by Miraaj Patel · generated from SEC filings and market data · Updated Oct 20, 2026 · How these pages are made
What is TSM worth?
- Fair-value range
- $504.78 – $504.78
- Market price
- $420.22
- Gap to fair value
- —
- Verdict
- Priced below our range
Reverse DCF, on our cash-flow model rather than the range above: Today's price implies revenue growth of more than 25%/yr. Above about 25% a year the reverse-DCF stops being informative. It solves for revenue growth alone — holding margins, capital intensity and the forecast horizon fixed — so a price well above our cash-flow model's value has nowhere to go but growth, and the solver returns a rate the model can't reconcile. Read it as "the price implies growth we can't justify", not as a forecast.
What is TSM's TickerWorth Score?
Scores higher than most companies we compare it with
Compared with Technology companies in US
Its strongest point: a profitable, high-quality business.
our cash-flow model doesn't fit this business, so we won't award our top grade off the remaining lenses
- Value · 70 of 100
Cheaper than 70% of Technology companies in US
- Price vs worth · 66 of 100
- Quality · 86 of 100
More profitable than 86% of Technology companies in US
- Financial health · 76 of 100
Financially stronger than 76% of Technology companies in US
- Growth · 58 of 100
Growing faster than 58% of Technology companies in US
- Momentum · 65 of 100
Outperformed 65% of Technology companies in US over the past year
Confidence: Medium confidence · Scored
Get the Undervalued Company of the Week.
Why TSM gets a range, not one number
At a recent price of $420.22, Taiwan Semiconductor Manufacturing Company Limited (TSM) sits below every lens we ran: our valuation lenses put the business somewhere between $504.78 and $504.78 per share. They disagree too widely for us to state a single fair value. We publish the range rather than a midpoint because a number that precise would claim more than the methods can support. This is an educational model, not a price target or a recommendation.
Read the full reasoning
The valuation discounts Taiwan Semiconductor Manufacturing Company Limited's projected free cash flows at a weighted-average cost of capital (WACC) of 10.9%, with a long-run terminal growth rate of 2.5%. About 70% of the enterprise value comes from the terminal value — the portion beyond the explicit forecast window — which is typical for a stable, cash-generative business and a reminder that small changes in the discount rate or terminal growth assumption swing the intrinsic value meaningfully.
Running the DCF in reverse — solving for the growth the current price already assumes — TSM would need sustained revenue growth of more than 25%/yr to justify today's price, against about 16.6% a year compounded in our base case. We don't quote a precise figure here, because past about 25% a year the reverse-DCF stops being informative: it solves for revenue growth alone, holding margins, capital intensity and the forecast horizon fixed, so a price well above our fair value has nowhere to go but growth. The honest reading is that the price implies growth this model can't reconcile — not that we forecast it.
Sensitivity matters more than any single number. Across a reasonable band of discount-rate assumptions, TSM's modeled DCF value ranges from about $101.29 to $164.32 per share. If that range still sits below today's price, the market is optimistic relative to the model across the whole band; if it brackets the price, the stock is roughly fairly valued on our assumptions. Use the interactive slider to see exactly where your own cost-of-capital view lands.
How to read this page: the DCF fair value is what Taiwan Semiconductor Manufacturing Company Limited would be worth if its cash flows grow as modeled and are discounted at the stated WACC. The assumptions table shows every input and its source; the reverse-DCF shows what the market believes; the sensitivity band shows how fragile the answer is. None of this is investment advice — it is a transparent, auditable framework for forming your own view of TSM's intrinsic value. Figures update as new filings and prices come in.
Every input behind TSM's DCF
| Input | Value |
|---|---|
| Base-year revenueTaiwan Semiconductor Manufacturing Company Limited FY2024 20-F (accession 0001193125-25-083423): ifrs-full:RevenueFromContractsWithCustomers, FY2024 full year. | $88,760,660,000 |
| Base EBIT marginTaiwan Semiconductor Manufacturing Company Limited FY2024 20-F (accession 0001193125-25-083423): ifrs-full:ProfitLossFromOperatingActivities 1,322,053,000,000 / revenue 2,894,307,700,000 = 45.68%, FY2024. | 45.7% |
| Forecast revenue growthESTIMATEAssumption — TickerWorth's 5-year explicit forecast | 30% → 24% → 17% → 10% → 4% |
| Risk-free rateLive feed — US 10-year Treasury yield (^TNX) | 5.1% |
| BetaLive feed — yfinance, 5-year monthly beta vs the S&P 500 (clamped to 0.4–2.5) | 1.24 |
| Terminal growthESTIMATEAssumption — TickerWorth house default 2.5%, held below WACC | 2.5% |
| Diluted sharesLive feed — sharesOutstanding | 5,186M |
| Market priceDelayed quote · as of 2026-10-20 13:08 UTC | $420.22 |
Change TSM's assumptions
The discount-rate dial and the editable model
ProChange growth, margin and WACC yourself — Pro (7-day free trial, card required).
What does Taiwan Semiconductor Manufacturing Company Limited do?
What does it do?
Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, 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 various wafer fabrication processes, such as processes to manufacture complementary metal- oxide-semiconductor (CMOS) logic, mixed-signal, radio frequency, embedded memory, bipolar CMOS mixed-signal, and others. It operates in the Semiconductors industry (Technology sector), headquartered in Taiwan. The company employs roughly 76,907 people.
How does it make money?
The business turns $4.9T in annual revenue into profit. Out of every $100 of sales, about $59 is left as operating profit (operating margin of 58.7%), after a 66% gross margin on the products/services it sells. After all costs, taxes and interest, 51.1% of revenue becomes bottom-line net profit.
Is it financially healthy?
Financially it looks solid: carries modest debt (0.1× equity), comfortably covers its short-term bills (2.5× current ratio), and is currently profitable.
Who at TSM filed insider trades?
| Date | Insider | Relationship | What happened | Value | Filing |
|---|---|---|---|---|---|
| Yuan Lipen | VP | Open-market buy | $3,175.60 | Form 4 for Yuan Lipen (opens sec.gov in a new tab) | |
| Yeap Choh Fei | SVP | Open-market buy | $4,128.28 | Form 4 for Yeap Choh Fei (opens sec.gov in a new tab) | |
| Zhang Kevin Xiaoqiang | SVP and Deputy Co-COO | Open-market buy | $4,684.01 | Form 4 for Zhang Kevin Xiaoqiang (opens sec.gov in a new tab) | |
| Yoo Chue-San | VP | Open-market buy | $3,969.50 | Form 4 for Yoo Chue-San (opens sec.gov in a new tab) | |
| Wu Shien-Yang | SVP | Open-market buy | $4,207.67 | Form 4 for Wu Shien-Yang (opens sec.gov in a new tab) | |
| Wei Che-Chia | Director, Chairman and CEO | Open-market buy | $11,432.16 | Form 4 for Wei Che-Chia (opens sec.gov in a new tab) |
A disclosure, not a signal to trade. Source: SEC EDGAR (Form 4). Older filings and the 90-day buying-and-selling read are part of Pro. See plans
Common questions
What is TSM's intrinsic value?
TickerWorth's valuation lenses put Taiwan Semiconductor Manufacturing Company Limited (TSM) between $504.78 and $504.78 per share, versus a market price of $420.22. They disagree too widely for us to state a single fair value, so we publish the range.
Is TSM overvalued or undervalued?
At $420.22 the price sits below every lens we ran. We don't call TSM overvalued or undervalued from a range this wide. This is an educational estimate, not advice.
What discount rate is used for TSM?
A WACC of 10.9% and a terminal growth rate of 2.5%.
Is Taiwan Semiconductor Manufacturing stock undervalued?
TickerWorth's fair-value range for Taiwan Semiconductor Manufacturing Company Limited (TSM) is $504.78 – $504.78 against a market price of $420.22. Priced below our range. We publish a range here, not one number, so we do not call it over- or undervalued. This is a model estimate, not investment advice.
Taiwan Semiconductor Manufacturing (TSM) DCF valuation and fair value
Our fair-value range for Taiwan Semiconductor Manufacturing Company Limited (TSM) is $504.78 – $504.78, built on a 10.9% discount rate (WACC) and 2.5% terminal growth. It blends our discounted-cash-flow model with other valuation lenses. Every assumption is listed on this page with its source.
What growth is priced into Taiwan Semiconductor Manufacturing stock?
Today's price implies revenue growth of more than 25%/yr. Above about 25% a year the reverse-DCF stops being informative. It solves for revenue growth alone — holding margins, capital intensity and the forecast horizon fixed — so a price well above our cash-flow model's value has nowhere to go but growth, and the solver returns a rate the model can't reconcile. Read it as "the price implies growth we can't justify", not as a forecast. This is a reverse DCF: it holds our cash-flow model's other inputs and solves for the revenue growth that makes the model equal today's price of $420.22. A model estimate, not investment advice.
Taiwan Semiconductor Manufacturing (TSM) insider trading
The most recent insider filing (SEC Form 4) for Taiwan Semiconductor Manufacturing Company Limited (TSM): Yuan Lipen, VP, open-market buy on 2026-10-07. The latest filings are listed on this page. A disclosure, not a signal to trade.
People who read TSM also read
Other ways into the coverage
Not investment advice. TickerWorth Score is a model output.
Educational tool. Every output reflects the assumptions shown — not a prediction and not investment advice. TickerWorth is not a licensed investment adviser, and these figures are estimates from public filings and market data that can be wrong.