TTSM

    90% Market Share, 214x Interest Coverage, and a 5% Discount: Why I'm Buying TSM Here

    90% Market Share, 214x Interest Coverage, and a 5% Discount: Why I'm Buying TSM Here
    • TSM printed its strongest March ever at NT$415B (+45% YoY), pushing Q1 revenue to the top of guidance at ~$35.7B while the rest of semis flatlined
    • Q4 2025 margins hit records: 62.3% gross, 54% operating, 48.3% net. Nearly half of every revenue dollar falls to the bottom line at $122B annual scale
    • Raw trailing FCF looks expensive, but strip out growth capex and normalized FCF jumps from $32B to $63B. The reinvestment bridge changes the valuation math
    • Blended fair value $391 vs $370 current price. Buy zone, not a screaming deal. Staged accumulation with heavier adds below $355
    • Quality 90/100, Safety 99/100, Interest Coverage 214x, Debt/Equity 0.22. The balance sheet could stop growing tomorrow and still compound for years
    Glenn Ford
    Apr 12, 20261:12 PM1050

    The Impossible Chokepoint

    Every investor in artificial intelligence is making the same bet whether they know it or not. They're betting that one company in Hsinchu, Taiwan, can keep converting sand into the most complex objects humanity has ever manufactured, at margins that would make a luxury goods CEO jealous. That company is Taiwan Semiconductor Manufacturing, and it just printed its strongest March in history.

    I don't say that casually. (TSM) reported March 2026 revenue of NT$415.19 billion, up 45.2% from a year ago. First quarter sales hit NT$1.134 trillion, landing at the very top of the company's own guidance range. This isn't a beat driven by accounting tricks or one-time items. It's raw demand from customers who have no alternative supplier for the chips powering the AI buildout.

    Here's what caught my attention: while the rest of the semiconductor industry outside of AI spent the last year flat or contracting, TSMC added the equivalent of a mid-cap foundry's entire annual revenue to its quarterly run rate. In twelve months. That acceleration signals something structural, not cyclical.

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