Independent equity research
Is TSMC (ADR) (TSM) a Buy, Hold or Sell?
TSMC (ADR) — our independent, AI-built valuation and rating, in brief.
HOLD
12-mo fair value
$390.00
To fair value
−14%
By · report dated 2026-08-02 · fair value derived independently of the market price.
The thesis, in brief
At $404 TSM already discounts the entire consensus path — revenue tripling to ~$366B by 2029 at ~49% net margins — at an 11.3% cost of capital, so the shares stall or de-rate toward $285 unless the January 2027 capital budget lands below ~$75B while gross margin holds above 65%; a further capex step-up or sub-65% margin guidance breaks the 2% FCF yield thesis, while consensus growth arriving with capital intensity falling proves me wrong toward $500
How we value it
We value TSMC (ADR) using Probability-weighted 10-yr FCF/DCF at 11.3% proprietary WACC incl. 1.5pp Taiwan risk premium (60%), cross-checked vs. 21x blended 2027E EPS ~$20 (40%); bear $285 / base $390 / bull $500. The 12-month fair value is set from that intrinsic estimate first, then compared to the market to read the upside or downside — never anchored to the current price.
What the full report covers
- Business & moat + industry cycle
- Earnings quality & normalized EPS
- Returns on capital (ROIC vs WACC)
- Balance-sheet safety
- Two independent valuations (DCF + multiples)
- Bear / base / bull fair values
- Earnings-call analysis
- Insider activity & positioning
- Technicals (RSI / ADX)
- A falsifiable thesis
Read the full TSMC (ADR) report
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