Compare Cirrus Logic, Inc. (CRUS) vs Taiwan Semiconductor Manufacturing Company Limited (TSM) Stock

Cirrus Logic, Inc. (CRUS) offers the better valuation at 23.5x trailing P/E (15.6x forward), making it the more compelling value choice. Analysts rate Cirrus Logic, Inc. (CRUS) a "Buy" — based on 22 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Cirrus Logic, Inc. (CRUS) is the cheapest at 23.5x versus Taiwan Semiconductor Manufacturing Company Limited at 35.1x. On forward P/E, Taiwan Semiconductor Manufacturing Company Limited is actually cheaper at 0.8x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Taiwan Semiconductor Manufacturing Company Limited wins at 0.03x versus Cirrus Logic, Inc.'s 0.87x — a PEG below 1.0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, Taiwan Semiconductor Manufacturing Company Limited (TSM) delivered a total return of +196.8%, compared to +69.4% for Cirrus Logic, Inc. (CRUS). A $10,000 investment in TSM five years ago would be worth approximately $30K today (assuming dividends reinvested). Over 10 years, the gap is even starker: TSM returned +1552% versus CRUS's +300.6%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Cirrus Logic, Inc. (CRUS) is the lower-risk stock at 1.30β versus Taiwan Semiconductor Manufacturing Company Limited's 1.44β — meaning TSM is approximately 11% more volatile than CRUS relative to the S&P 500. On balance sheet safety, Cirrus Logic, Inc. (CRUS) carries a lower debt/equity ratio of 7% versus 18% for Taiwan Semiconductor Manufacturing Company Limited — giving it more financial flexibility in a downturn.

Taiwan Semiconductor Manufacturing Company Limited (TSM) is the more profitable company, earning 45.1% net margin versus 17.5% for Cirrus Logic, Inc. — meaning it keeps 45.1% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: TSM leads at 50.8% versus 21.6% for CRUS. At the gross margin level — before operating expenses — TSM leads at 59.9%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, Taiwan Semiconductor Manufacturing Company Limited (TSM) is the more undervalued stock at a PEG of 0.03x versus Cirrus Logic, Inc.'s 0.87x. A PEG below 1.0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, Taiwan Semiconductor Manufacturing Company Limited (TSM) trades at 0.8x forward P/E versus 15.6x for Cirrus Logic, Inc. — 14.7x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for TSM: 8.9% to $408.00.

In this comparison, TSM (0.8% yield) pays a dividend. CRUS does not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, Taiwan Semiconductor Manufacturing Company Limited (TSM) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (0.8% yield, +1552% 10Y return). Both have compounded well over 10 years (TSM: +1552%, CRUS: +300.6%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. TSM pays a dividend while CRUS does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.