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A value play in the semiconductor industry $TSM
$TSM Rundown 📊
Efficiency
- Gross Margin: 59.7%
- Operating Margin: 49.5%
- ROC: 28.3%
- FCF/Net Income: 49%
Growth 5Y
- Rev: 18.28%
- Net Income: 23.79%
- FCF: 24.25%
Valuation
- FCF Yield: 3.4%
- EV/EBIT: 13
- P/S: 6.74
The Company
$TSM, founded in 1987 in Taiwan, is the global leader in semiconductor foundries, pioneering the pure-play foundry model. Specializing in advanced integrated circuits, it's a key player in smartphones and high-performance computing. Clients include Apple, Nvidia, AMD. #TSM #Tech 🌍🔧🔬
Strategies
$TSM’s success is driven by:
- Embracing the Pure Play Foundry model, focusing solely on manufacturing without competing with clients.
- Investing heavily in R&D to continuously refine manufacturing processes.
- Building long-lasting partnerships based on trust.
Competitive Advantages
$TSM's competitive advantages include:
- Technological Leadership with cutting-edge chip innovation.
- Economies of Scale, producing high-quality chips cost-effectively.
- Strong Customer Base including giants like Apple, ensuring steady revenue streams.
High gross margin and ROC = moat
Price Action
TSM has returned 1,530% to shareholders compounding 11.47% over 25 years compared to the S&P500’s 9.8%. Slow, steady and stable wins the race.
$TSM is an intriguing company, go see my full analysis on: (link below)
- Management
- Performance
- Comp advantages
- Growth Opportunities
- Financial Health
- Valuation
My blog - "Against the Grain", https://againsthegrain.substack.com/
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