TSM
Taiwan Semiconductor Manufacturing Company Limited
$415.58
Platform & Compounding FCF
80%
Two-stage FCF DCF
Moderate
·
Conviction
Undervalued
Trading 26.6% below fair value
You pay
$415.58
Bear
$273.69
Fair
$566.52
Bull
$978.22
Bear
$273.69
-34.1%
15% stage 1 growth, 11% discount
Fair
$566.52
+36.3%
25% stage 1 growth, 11% discount
Bull
$978.22
+135.4%
32% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (25% base case)
Terminal Value % of EV
49%
Implied Market Multiple
49.0x
Market is pricing in (growth)
20.9%
vs 25.0% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $586.00 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $566.52 per share.
Warnings
Financial statements were converted from TWD into USD using USDTWD at 0.0309 USD per TWD.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions