On June 10, 2026, Taiwan Semiconductor Manufacturing Co Ltd TSM shares fell 4.5% today, bringing the current price to $408.75. This move comes amidst a 52-week range that has seen a high of $450.16 and a low of $206.20.
- GF Valueâ„¢ verdict: Current price of $408.75 is 40.4% above the GF Valueâ„¢ of $291.19.
- GF Scoreâ„¢: 94/100 (Strong), indicating a robust overall performance based on multiple metrics.
- Most notable signal: Insiders have sold $14.0M worth of shares compared to $1.2M in purchases over the last three months.
Is TSM Overvalued or Undervalued?
According to the latest data, TSM shares are currently trading at $408.75, which is significantly above the GF Valueâ„¢ estimate of $291.19, indicating that the stock is overvalued by approximately 40.4%. The GF Valuation label categorizes TSM as "Significantly Overvalued," suggesting that there may be inherent risks for potential investors. The current price does not provide a substantial margin of safety for investment, as it exceeds the intrinsic value identified through GF Valueâ„¢ methodology, which is calculated from historical trading multiples, past business growth, and future performance estimates.
The overvaluation presents a potential risk for investors, as it may lead to price corrections in the future. While TSM exhibits strong financial health and profitability, the current trading price suggests that the stock may not align with its intrinsic value, potentially limiting future upside for investors entering at these levels.
How Does TSM's Valuation Compare to Its History?
| Metric | Current | Historical |
|---|---|---|
| P/E (TTM) | 34.0x | 22.8x |
| Forward P/E | 26.1x | N/A |
TSM's current P/E (TTM) of 34.0x is significantly higher than its 5-year median P/E of 22.8x, indicating that the stock is trading well above its historical valuation levels. This analysis aligns with the GF Valueâ„¢ verdict, which suggests that TSM is overvalued. The elevated P/E ratio emphasizes the risk of investing in TSM at this time, as investors may be paying a premium relative to historical earnings.
What Does TSM's GF Scoreâ„¢ Tell Us?
| Metric | Rating |
|---|---|
| GF Scoreâ„¢ | 94 |
| Financial Strength | 9/10 |
| Profitability | 10/10 |
| Growth | 10/10 |
| Valuation | 3/10 |
| Momentum | 9/10 |
TSM's GF Scoreâ„¢ of 94/100 indicates strong fundamentals with high marks in Profitability (10/10) and Growth (10/10), suggesting that the company has robust business performance and growth potential. However, the Valuation rank of 3/10 highlights significant concerns regarding its current trading price. The Financial Strength score of 9/10 and Momentum score of 9/10 further reinforce the company's solid position, despite the valuation mismatch.
What Are Insiders Doing with TSM Stock?
Recent insider activity for TSM reveals a notable pattern of selling, with insiders having sold $14.0M worth of shares compared to only $1.2M in purchases over the last three months. This trend may suggest a lack of confidence among insiders regarding the stock's current valuation, as they appear to be taking profits amidst the high trading price. Such behavior can often serve as a warning signal for external investors, prompting caution in investment decisions.
What This Means for Investors
Based on the GF Valueâ„¢ assessment, TSM is currently overvalued, trading at a significant premium to its estimated intrinsic value. While the company boasts strong fundamentals and growth potential, investors should proceed with caution given the high valuation relative to historical metrics.
For the complete analysis, visit the Taiwan Semiconductor Manufacturing Co Ltd TSM stock page. You can also explore the GF Valueâ„¢ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions
What is TSM's GF Scoreâ„¢?
TSM's GF Scoreâ„¢ is 94/100, indicating a strong overall performance based on key financial metrics.
Is TSM overvalued or undervalued?
TSM is currently overvalued, with its share price trading significantly above its intrinsic GF Valueâ„¢ estimate.
What is TSM's P/E ratio?
TSM's P/E (TTM) is 34.0x, which is significantly higher than its 5-year median of 22.8x, indicating it is trading above its historical valuation levels.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
