# Taiwan Semiconductor Manufacturing Company Ltd. (TSM) fundamentals

Data as of 2026-09-08. NYSE, United States. Sector: Technology / Semiconductors & Semiconductor Equipment. Price $428.91, market value $2.22 trillion.

## Valuation
- **P/E (trailing): 31.8×** (5-yr avg 86.1×, 3-yr avg 79.2×). Taiwan Semiconductor Manufacturing Company Ltd. trades at 31.8× trailing earnings, well below its own five-year average of 86.1×: cheap by its own standards. The Technology median in the September 2026 study was 32.1×. Forward P/E is 19.6×, lower than trailing, so analysts expect earnings to grow.
- **PEG: 0.00**. A PEG of 0.00 means the P/E is low relative to expected earnings growth: the market is not paying much for that growth.
- **Price / sales: 0.5×**. Each dollar of revenue is priced at 0.5×, a low multiple typical of thin-margin businesses or out-of-favour stocks.
- **Price / book: 0.4×**. The shares trade below book value, which can signal a bargain or a balance sheet the market doubts.
- **EV / EBITDA: 0.0×**. Enterprise value is 0.0× operating earnings before depreciation, the multiple that ignores how the company is financed; below 8× is inexpensive for most sectors.
- **Free-cash-flow yield: 50.6%** (5-yr avg 13.1%). Free cash flow equals 50.6% of the market value, above its five-year average of 13.1%, so the shares are cheaper on cash than they have usually been. Above 5% is generally attractive.
- **Earnings yield: 3.1%**. The inverse of the P/E: 3.1% of the price is earned each year.

## Profitability
- **Gross margin: 64.2%**. Taiwan Semiconductor Manufacturing Company Ltd. keeps 64.2% of revenue after the direct cost of what it sells, the kind of margin that comes with software, brands or pricing power.
- **Operating margin: 56.1%**. 56.1% of revenue is left after running the business, an exceptional level.
- **Net margin: 44.6%**. 44.6% of each dollar of sales reaches the bottom line.
- **Return on equity: 31.7%**. 31.7% on shareholders' equity is excellent if it is not driven by leverage; sustained above 20% usually signals a competitive advantage.
- **Return on invested capital: 62.9%**. Return on all capital, debt included, is 62.9%: comfortably above what that capital costs.
- **Return on assets: 27.9%**. Each dollar of assets produces 27.9% of profit.

## Growth
- **Revenue growth (1 yr): 4215.3%** (3-yr 272.5%/yr, 5-yr 140.1%/yr). Revenue grew 4215.3% over the last year, against 140.1% a year compounded over five years: growth is accelerating.
- **Free-cash-flow growth (3 yr): 286.6%/yr**. Free cash flow has compounded at 286.6% a year over three years, lagging earnings: check whether profits are turning into cash.

## Financial health
- **Debt to equity: 0.20**. Debt is 0.20 times equity: a conservative balance sheet.
- **Net debt / EBITDA: net cash**. Taiwan Semiconductor Manufacturing Company Ltd. holds more cash than debt.
- **Interest coverage: 211.0×**. Operating profit covers interest 211.0× over, a safe margin.
- **Current ratio: 2.51** (quick 2.32). Current assets cover the next year's liabilities 2.51 times.
- **Altman Z-score: 3.10**. A Z-score of 3.10 places the company in the safe zone for bankruptcy risk.
- **Piotroski F-score: 7/9**. 7 of 9 fundamental checks pass: strong and improving financials.

## Dividends
- **Dividend yield: 0.95%** ($4.08 per share, trailing). Taiwan Semiconductor Manufacturing Company Ltd. yields 0.95%, a modest yield more typical of a growth-oriented payer.
- **Payout ratio: 27%** (47% of free cash flow). 27% of earnings goes out as dividends, leaving room to keep raising it.
- **Consecutive years of increases: 2**. 2 straight years of increases.
- **Dividend growth (5 yr): 12.8%/yr** (1-yr 33.4%). The dividend has compounded at 12.8% a year over five years, doubling roughly every 6 years at that pace.

## Analyst view
- **Analyst consensus: strong_buy** (19 analysts). 19 analysts cover Taiwan Semiconductor Manufacturing Company Ltd.; the consensus is strong_buy, with an average price target of $552.38 (+29% from the current price). Analyst opinion is shown for context; it is not part of the Fundamental Score.

## Price and momentum
- **Total return (1 yr): 84.4%** (YTD 41.9%, 3-mo 3.6%). The shares are up 84.4% over twelve months including dividends.
- **From 52-week high: -10.5%** (73.7% above the low). Trading 10% below its 52-week high.
- **200-day average: above**. The price sits above its 200-day moving average, the usual definition of an uptrend.
- **RSI (14-day): 57**. An RSI of 57 is neutral.
- **Beta (1 yr): 2.15** (volatility 40%). Beta of 2.15 against the S&P 500: the shares move much more than the market.

Live score and charts: https://foliofundamentals.com/analyzer?s=TSM · Page: https://foliofundamentals.com/stocks/tsm

Not investment advice.