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Taiwan Semiconductor Manufacturing Co has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.
Good Sign:
Taiwan Semiconductor Manufacturing Co Ltd shows strong financial strength.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is rated on a scale of 1 to 10 and is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.
4. Other debt related ratios.
A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Taiwan Semiconductor Manufacturing Co has no long-term debt (1).
Taiwan Semiconductor Manufacturing Co's debt to revenue ratio for the quarter that ended in Jun. 2026 was 0.00.
As of today, Taiwan Semiconductor Manufacturing Co's Altman Z-Score is 16.38.
(1) Note: An indication of "no long-term debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.
Taiwan Semiconductor Manufacturing Co (NYSE:TSM) Financial Strength Explanation
The rank is rated on a scale of 1 to 10. A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Taiwan Semiconductor Manufacturing Co has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.
Taiwan Semiconductor Manufacturing Co Financial Strength Related Terms
TSM vs NVDA, AVGO, MU: Financial Strength Comparison
For the Semiconductors subindustry, Taiwan Semiconductor Manufacturing Co's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Taiwan Semiconductor Manufacturing Co Financial Strength vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Taiwan Semiconductor Manufacturing Co's Financial Strength distribution charts can be found below:
* The bar in red indicates where Taiwan Semiconductor Manufacturing Co's Financial Strength falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
Taiwan Semiconductor Manufacturing Co had no long-term debt (1).
The higher the ratio, the stronger the company's financial strength is.
Good Sign:
Ben Graham prefers companies' interest coverage to be at least 5. Taiwan Semiconductor Manufacturing Co Ltd has enough cash to cover all of its debt. Its financial situation is stable.
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
Taiwan Semiconductor Manufacturing Co has a Z-score of 16.38, indicating it is in Safe Zones. This implies the Z-Score is strong.
Good Sign:
Altman Z-score of 16.38 is strong.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Taiwan Semiconductor Manufacturing Co (TSM) has a Financial Strength of 9 as of Jun. 2026. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Taiwan Semiconductor Manufacturing Co and its competitors. This is near median its historical median of 9.00. Over the past decade, Taiwan Semiconductor Manufacturing Co's Financial Strength has ranged from 7.00 to 10.00.
Is Taiwan Semiconductor Manufacturing Co's Financial Strength too high?
Taiwan Semiconductor Manufacturing Co's current Financial Strength of 9 is near median its 10-year median of 9.00. Over the past 10 years, this metric has ranged from a low of 7.00 to a high of 10.00. Overall, Taiwan Semiconductor Manufacturing Co has a GF Score™ of 98/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Taiwan Semiconductor Manufacturing Co's Financial Strength compare to NVDA and AVGO?
Taiwan Semiconductor Manufacturing Co's Financial Strength of 9 can be compared against companies in the Semiconductors industry. Historically, Taiwan Semiconductor Manufacturing Co's own Financial Strength has ranged from 7.00 to 10.00 over the past decade. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Financial Strength for a Semiconductors company?
A good Financial Strength depends on the Semiconductors industry context. However, Financial Strength should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Financial Strength mean?
A high Financial Strength can signal that a stock is expensive relative to its fundamentals. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Taiwan Semiconductor Manufacturing Co and its competitors. Taiwan Semiconductor Manufacturing Co's current Financial Strength is 9, which is near median its own 10-year median of 9.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Taiwan Semiconductor Manufacturing Co stock overvalued right now?
Based on GuruFocus' analysis, Taiwan Semiconductor Manufacturing Co (TSM) is currently considered Modestly Overvalued. The stock's GF Value™ is $352.06, compared to a current price of $426.35 — trading 21.1% above its estimated fair value. The current Financial Strength is 9, which is near median its 10-year median of 9.00. Taiwan Semiconductor Manufacturing Co's overall GF Score™ is 98/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Financial Strength calculated?
Financial Strength is calculated from a company's financial statements. For Taiwan Semiconductor Manufacturing Co (TSM), the current Financial Strength is 9 as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Taiwan Semiconductor Manufacturing Co (TSM) Overvalued in 2026?
Based on GuruFocus' analysis, Taiwan Semiconductor Manufacturing Co stock appears to be overvalued.
The current stock price of $426.35 is trading 21.1% above its estimated GF Value™ of $352.06.
GuruFocus considers Taiwan Semiconductor Manufacturing Co to be Modestly Overvalued.
Key valuation signals for TSM:
Financial Strength: 9 (near median its 10-year median of 9.00)
GF Value™: $352.06 vs. price of $426.35 (21.1% above fair value)
No single metric tells the full story. See the TSM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Taiwan Semiconductor Manufacturing Co. is the world's largest dedicated chip foundry, with about 70% market share in 2025. TSMC was founded in 1987 as a joint venture of Philips, the government of Taiwan, and private investors. It went public in Taiwan in 1994 and as an ADR in the US in 1997. TSMC's scale and high-quality technology allow the firm to generate solid operating margins, even in the highly competitive foundry business. Furthermore, the shift to the fabless business model has created tailwinds for TSMC. The foundry leader has an illustrious base of customers, including Apple, AMD, and Nvidia, that look to apply its cutting-edge process technologies to their semiconductor designs. TSMC employs more than 83,000 people.
98GF Score
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