Summary

• Taiwan Semiconductor Manufacturing delivered strong Q1 results, with revenues up 40.6% year-on-year and gross margins reaching 66.2%.
• TSM's 3nm node ramp-up is accelerating margin accretion, with 3nm sales now 34% of advanced node revenue and expected to drive further upside in 2026.
• Management guides for Q2 sales growth of 8.6%-12% and expects over 30% revenue growth in 2026, supported by capacity expansions and robust demand.
• I mark TSM a strong buy, targeting $467.34 per share, citing margin expansion, EBITDA growth, net cash strength, and undervaluation versus peers.
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Share prices of Taiwan Semiconductor Manufacturing (TSM) or TSMC have risen 8.2% since my last report, outperforming the S&P 500. Earlier in April, the company reported financial results that exceeded estimates by more than $400 million

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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