Market Pulse59Neutral

Taiwan Semiconductor Manufacturing Company LimitedOpportunity Rank #27(TSM) Intrinsic Value & DCF Analysis (2026)

Sector: Technology

Current Price

$414.15

Last updated: May 08, 2026

Price vs Intrinsic Value

$414.15
Price
$421.04
Intrinsic Value
Undervalued by 2%MOS: $336.83

Fundamental Score

82/100
Bullish

Weighted across 6 signals

Narrative Score

80/100
Strong

No change vs previous

Trend Score

88/100
Strong

As of 2026-05-08

The intrinsic value of Taiwan Semiconductor Manufacturing Company Limited (TSM) is estimated at $421.04 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $414.15, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 6.68% long-term growth rate and a 9.69% discount rate, reflecting expected future free cash flow and cost of capital.

The intrinsic value of Taiwan Semiconductor Manufacturing Company Limited (TSM) is estimated at $421.04 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $414.15, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 6.68% long-term growth rate and a 9.69% discount rate, reflecting expected future free cash flow and cost of capital.

Valuation Details

$421.04
▲ 1.66% upside
20% margin of safety: $336.83
Years: 10Growth Rate: 6.68%
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Capital Efficiency

Average Quarterly ROIC
14.97%
Cost of Capital (estimated)8%
Value StatusCreating Value

The company is earning a higher return on invested capital than it costs to raise that capital — a sign of strong, efficient value creation.

Complete historical ROIC is available with
.

Fundamental Details

82/100
BullishWeighted across 6 signals
DCF Discount
1.7% discount to price
53
FCF Yield
5.5% trailing FCF yield
87
ROIC vs WACC
ROIC 15.0% vs WACC 8.0% (1.9x)
94
Net Debt / FCF
Net cash position
100
Buybacks
Share count flat
50
FCF CAGR (5Y)
22.4% 5Y FCF CAGR
100
Strengths lead the score: FCF Yield, ROIC vs WACC.

Narrative Details

80/100
Strong
Vs 6-Month Baseline:Average (55th pct)Weighted across 6 recent drivers
Trend: StableConfidence: 100%Updated: 18h ago
Sources: 204 (200 News · 4 Analyst)
Drivers(last 30 days)
166 news sentiment+8.1
23 regulatory scrutiny+1.1
5 earnings beat+0.2
2 upgrade headlines+0.2
2 guidance raise+0.1
Downgrade headlines+0.1

Trend Details

88/100
StrongAs of 2026-05-08311 daily bars used
6M Relative Strength vs SPY+31.3%
Distance from 52-Week High-1.9%
Price vs 50 EMA+11.1%
Price vs 21 EMA80 · +5.6%
Price vs 50 EMA89 · +11.1%
21 EMA vs 50 EMA84 · +5.2%
3M RS vs SPY87 · +11.2%
6M RS vs SPY97 · +31.3%
Distance from 52W High96 · -1.9%

Investment Coach

Updated 15h ago
BUYConfidence: 74%
Thesis
Taiwan Semiconductor Manufacturing Company Limited (TSM) presents a strong investment opportunity with a robust fundamental score of 83 and a return on invested capital (ROIC) significantly exceeding its cost of capital by 7 percentage points. The company also maintains a healthy free cash flow yield of 5.5%, supporting its bullish outlook despite a modest valuation upside of approximately 4.5%.
Key Risk
A key risk is the potential decline in ROIC below the cost of capital, which could undermine the company's profitability and valuation.
Signals To Watch
  • Price moving to at least a mid-teens discount to fair value.
  • ROIC staying above cost of capital over coming quarters.
  • Meaningful shifts in the narrative score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 6.68%5 Year CAGR: 13.48%

Free Cash Flow (in millions)

TTM20252024202320222021202020192018201720162015201420132012201120102009200820072006
$117,386$116,645$88,457$69,863$85,851$62,367$42,736$34,493$28,508$29,289$27,754$25,171$22,698$20,276$17,016$14,675$13,297$7,877$8,949$8,514$9,020

How Intrinziq Estimates Fair Value

Intrinziq estimates Taiwan Semiconductor Manufacturing Company Limited's intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

Taiwan Semiconductor Manufacturing Company LimitedTechnology

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 a range of wafer fabrication processes, including processes to manufacture complementary metal- oxide-semiconductor (CMOS) logic, mixed-signal, radio frequency, embedded memory, bipolar CMOS mixed-signal, and others. The company also offers customer and engineering support services; manufactures masks; and invests in technology start-up companies; researches, designs, develops, manufactures, packages, tests, and sells color filters; and provides investment services. Its products are used in high performance computing, smartphones, Internet of things, automotive, and digital consumer electronics. The company was incorporated in 1987 and is headquartered in Hsinchu City, Taiwan.