Stock fact sheet · data as of
Taiwan Semiconductor Manufacturing Company Limited (TSM): fair value, margin of safety and Wheel Score
Ticker symbol TSM · Technology · Semiconductors · Taiwan · ADR · Growth Quality
TSM is an American depositary share (ADR): the US listing of Taiwan Semiconductor Manufacturing Company Limited, whose own shares trade on its home exchange. It trades in dollars during US hours; currency moves and the home country's rules also affect it, and the depositary bank charges a small yearly fee.
Is TSM undervalued?
Taiwan Semiconductor Manufacturing Company Limited (TSM) closed at 395.75 on 5 Nov 2026, 11% above the GLS average fair value of 357.60. Only 2 of the 9 models that produced a number value the shares above the current price. The margin of safety is negative, so the stock fails the "below fair value" Wheel Trade Filter; a premium of this size is common for companies whose growth the models are conservative about.
The 9 models disagree widely: DDM gives 53.61 while GLS Growth gives 917.08. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
Ranked against every other company we cover, TSM is clearly faster-growing than it is cheap, so the nightly engine files it under Growth (value score 23, growth score 77, out of 100). It also carries the Quality tag (Quality = moat 7.5+ out of 10 and Piotroski 7+).
Nine valuation models for TSM
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 123.98 | -69% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 110.66 | -72% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 832.13 | +110% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 351.74 | -11% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 917.08 | +132% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 304.80 | -23% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 331.46 | -16% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 53.61 | -86% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 192.90 | -51% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | 7.50 | -98% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 585.57 | +48% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
On financial health TSM scores 8/9 (Piotroski): most of the nine tests - positive earnings and cash flow, falling debt, rising margins and turnover - are passed, which is the kind of balance sheet a wheel trader is happy to be assigned. The GLS Moat score is 9.1 out of 10 - high returns on capital, steady margins and growth that held up through bad years point to a durable business.
Returns on capital are high - ROIC 26.4%, ROE 31.7%, ROA 21.4% - with debt at 0.20 times equity and a free-cash-flow yield of 2.6%.
The dividend yield is 0.92% with a payout ratio of 22% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Wafer [member] 86%, Other Products [member] 14% (fiscal year FY2025).
Institutional ownership scores 2/10, insider activity 10/10 and Congressional trading 10/10 on the GLS smart-money scales; the last recorded insider buy was on 1 Nov 2026; the last recorded Congressional buy was on 9 Oct 2026.
| Piotroski F-score | 8 / 9 | ROIC | 26.4% |
|---|---|---|---|
| GLS Moat | 9.1 / 10 | ROE | 31.7% |
| Debt / equity | 0.20 | ROA | 21.4% |
| Free-cash-flow yield | 2.6% | Payout ratio | 22% |
| Institutions | 2 / 10 | Insiders · Congress | 10 · 10 / 10 |
Wheel Score 52: Fair
TSM scores 52 out of 100 on the Wheel Score (Fair band, 50-69) because it fails filter 3, below fair value - trades 11% above our fair value. A stock must pass all 9 Wheel Trade Filters to reach 70. Otherwise the parts read: value weak, premium strong, moat strong, health strong, red flags strong, option trading strong, stability strong.
Implied volatility is 39% on the near-the-money contracts 20-60 days out - inside the 35-60% sweet spot the Wheel Score rewards most: enough premium to be worth selling, not so much that the risk is unpaid. The option chain is deep: 972,080 contracts of open interest across all expiries, which means tight fills at most strikes.
Volume runs at 14.4M shares a day on a market cap of $2.05T, with a beta of 1.44 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score rates that strong.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Fails | trades 11% above our fair value |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Weak | 11% above fair value | |
| Premium | Strong | implied volatility 39% | |
| Moat | Strong | moat 9.1/10 | |
| Health | Strong | Piotroski 8/9 | |
| Red Flags | Strong | Red Flags score 100/100 | |
| Option trading | Strong | 95,891 contracts a day, 972,080 open interest | |
| Stability | Strong | beta 1.44, $2.05T company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 21 Jan 2027, 77 days away - outside the window of a 30-45-day put sold today. The next ex-dividend date is 10 Dec 2026 (1.09 per share).
No analyst upgrades or downgrades were recorded in the last 30 days.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Semiconductors
The 12 companies below are the closest to Taiwan Semiconductor Manufacturing Company Limited by market cap within the Semiconductors industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| AVGO Broadcom Inc. | 325.48 | 224.40 | -45% | 48Weak | $1.55T |
| SKHY SK hynix Inc. | 143.07 | 666.57 | +79% | 84Good | $1.02T |
| MU Micron Technology, Inc. | 795.23 | 1,637.28 | +51% | 89Prime | $899.7B |
| NVDA NVIDIA Corporation | 200.13 | 206.31 | +3% | 75Good | $4.82T |
| AMD Advanced Micro Devices, Inc. | 488.78 | 137.76 | -255% | 43Weak | $797.9B |
| ASML ASML Holding N.V. | 1,496.30 | 1,187.25 | -26% | 53Fair | $576.7B |
| INTC Intel Corp. | 58.27 | 19.05 | -206% | 38Weak | $309.7B |
| AMAT Applied Materials, Inc. | 369.40 | 244.93 | -51% | 47Weak | $293.2B |
| TXN Texas Instruments Incorporated | 311.49 | 135.32 | -130% | 51Fair | $284.6B |
| LRCX Lam Research Corporation | 221.43 | 123.45 | -79% | 49Weak | $277.1B |
| ARM Arm Holdings plc American Depositary Shares | 191.80 | 32.79 | -485% | 36Weak | $204.8B |
| ADI Analog Devices, Inc. | 406.24 | 138.81 | -193% | 48Weak | $196.8B |
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A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the top 10 stocks that pass all 9 Wheel Trade Filters, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about TSM
Is TSM undervalued right now?
No: at 395.75 the stock trades 11% above the GLS average fair value of 357.60 (data as of 5 Nov 2026). The margin of safety is negative.
What is the Wheel Score of TSM and what does it mean?
TSM scores 52 out of 100 (Fair) - it fails Wheel Trade Filter 3. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for TSM?
357.60 per share as of 5 Nov 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Taiwan Semiconductor Manufacturing Company Limited report earnings next?
The next earnings report is due on 21 Jan 2027, 77 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does TSM have listed options, and how liquid are they?
Yes. The nightly snapshot found 966 listed contracts with 972,080 open interest across all expiries and implied volatility of 39% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.
Is TSM an ADR?
Yes. TSM is an American depositary share (ADR): the US listing of Taiwan Semiconductor Manufacturing Company Limited, whose own shares trade on its home exchange. It trades in dollars during US hours; currency moves and the home country's rules also affect it, and the depositary bank charges a small yearly fee.