A Look At Taiwan Semiconductor Manufacturing (NYSE:TSM) Valuation After Strong Recent Share Price Gains - simplywall.st

This article provides an in-depth valuation analysis of Taiwan Semiconductor Manufacturing Company (TSMC) following its recent strong stock price performance. TSMC has seen a 23% gain over the past th... Read original →

TSMC’s current 6.7% valuation premium reflects excessive optimism around its AI chip foundry dominance. Technologically, its leadership in 3nm and EUV is locking in clients like NVIDIA and AMD but straining advanced packaging and materials supply chains. Geopolitically, U.S. CHIPS Act mandates are inflating Arizona fab costs by 15–20%, while overreliance on Taiwan, China as a single manufacturing node remains underpriced. Intel is accelerating outsourcing to bypass process gaps, while Texas Instruments retreats into analog—highlighting a strategic bifurcation between leading-edge logic and mature nodes. If AI chip demand slows or CoWoS capacity lags over the next 18 months, the valuation cushion could vanish. The real long-tail leverage lies in ecosystem lock-in post-2nm GAA transistor ramp.