MODEL VERDICT
Taiwan Semiconductor Manufacturing Company Limited (TSM) — Relative Valuation
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| Feb 28, 2026 | MODERATE | 0.69 | $374.58 | CURRENT | — |
| Feb 21, 2026 | MODERATE | 0.69 | $370.54 | CURRENT | — |
| Feb 14, 2026 | MODERATE | 0.69 | $366.36 | CURRENT | — |
| Feb 11, 2026 | MODERATE | 0.69 | $361.91 | CURRENT | — |
| Jan 11, 2026 | MODERATE | 0.65 | $323.63 | Pending | +9.8% |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 64 analyst estimates | $14543.46 | +3782.6% | 20% | A- | Analyst Est. |
| EV/EBITDA 54 industry peers | $16446.89 | +4290.8% | 20% | A- | Peer Data |
| Industry Median P/E 47 industry peers | $15096.56 | +3930.3% | 15% | A | Peer Data |
| Price / Free Cash Flow 49 industry peers | $10389.22 | +2673.6% | 15% | B+ | Peer Data |
| EV/EBIT 51 industry peers | $17778.68 | +4646.3% | 8% | B+ | Peer Data |
| EV/FCF 54 industry peers | $10669.13 | +2748.3% | 7% | B | Model Driven |
| Peg Ratio 25 industry peers | $16864.32 | +4402.2% | 5% | B | Data |
| EV To Revenue 74 industry peers | $5925.46 | +1481.9% | 4% | B | Data |
| Price / Sales 74 industry peers | $5740.86 | +1432.6% | 3% | B | Model Driven |
| Earnings Yield 48 industry peers | $15806.25 | +4119.7% | 2% | B | Data |
| FCF Yield 53 industry peers | $10760.40 | +2772.7% | 1% | B | Data |
| Weighted Output Blended model output | $11206.14 | +2891.7% | 100% | 85 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 29× | 32× | 35× (Current) | 38× | 41× |
|---|---|---|---|---|---|
| Bear Case (11%) | $10781 | $11896 | $13011 | $14126 | $15242 |
| Conservative (18%) | $11453 | $12638 | $13823 | $15007 | $16192 |
| Base Case (27.7%) | $12393 | $13675 | $14957 | $16239 | $17521 |
| Bull Case (37%) | $13334 | $14714 | $16093 | $17473 | $18852 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 0.83 | 0.88 | 0.39 | 1.11 | 0.25 |
| EV/EBIT | 0.26 | 0.28 | 0.03 | 0.47 | 0.24 |
| EV/EBITDA | 0.17 | 0.17 | 0.02 | 0.30 | 0.15 |
| P/FCF | 1.65 | 1.88 | 0.74 | 2.37 | 0.56 |
| P/FFO | 0.52 | 0.56 | 0.27 | 0.67 | 0.15 |
| P/TBV | 0.23 | 0.24 | 0.13 | 0.31 | 0.07 |
| P/AFFO | 1.75 | 1.38 | 1.13 | 3.77 | 0.93 |
| P/B Ratio | 0.23 | 0.24 | 0.13 | 0.31 | 0.07 |
| Div Yield | 0.53 | 0.46 | 0.30 | 0.86 | 0.21 |
| P/S Ratio | 0.33 | 0.35 | 0.17 | 0.42 | 0.09 |
Based on our peer multiples analysis with 28 valuation metrics, the model estimates TSM's fair value at $11206.14 vs the current price of $374.58, implying +2891.7% upside potential. Model verdict: Significantly Undervalued. Confidence: 85/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $11206.14 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $7952.91 (P10) to $11553.86 (P90), with a median of $9744.32.
TSM's current P/E of 35.1x compares to the industry median of 45.1x (47 peers in the group). This represents a -22.1% discount to the industry. The historical average P/E is 0.8x over 7 years. Signal: Discount.
23 analysts cover TSM with a consensus rating of Buy. The consensus price target is $408.00 (range: $330.00 — $450.00), implying +8.9% upside from the current price. Grade breakdown: Strong Buy (0), Buy (16), Hold (7), Sell (0), Strong Sell (0).
The model confidence score is 85/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (8), and model agreement (2). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: TSM trades at the 3400th percentile of its historical P/E range. A reversion to median (0.8×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that TSM's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +0.9σ, meaning margins are 0.9 standard deviations above their historical average. If margins revert to the 7-year mean (45.5%), the model estimates fair value drops by 2490.0% to approximately $281. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.