Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) / Equity Bottom-Up

TSMC (Taiwan Semiconductor Manufacturing) (TSM US)

TSMC (Taiwan Semiconductor Manufacturing)

<ul>
<li>The SOX is up ~55% since March ’26, on the back of massive earnings. Valuations are  average. Within the SOX, there is a wide divergence in performance and valuations.</li>
<li>Memory sector is, at the same time: highest earnings growth, highest stock performance, and yet the lowest valuations. </li>
<li>Within the big caps, NVDA and TSMC are now abnormally cheap.</li>
</ul>


The SOX is up ~55% since March ’26, on the back of massive earnings. Valuations are  average. Within the SOX, there is a wide divergence in performance and valuations.
Memory sector is, at the same time: highest earnings growth, highest stock performance, and yet the lowest valuations. 
Within the big caps, NVDA and TSMC are now abnormally cheap.


What to Do with Semi Stocks? The SOX Rally Is Not a Crazy Bubble.

Global Equities, Multi-Asset PM, Dantes Outlook

Damanick Dantes, CMT

Global Equities, Multi-Asset PM

Dantes Outlook

We invest over a full market cycle, using multi-asset portfolios tailored to each global client, from individuals to family offices.

Built to Endure

Cross Asset Strategy

<ul>
<li>CTAs are positioned in Asia uptrends, but the stocks that support it are losing momentum.</li>
<li>We uncovered stocks that sit outside the CTA trade that may be less vulnerable to outflows.</li>
<li>Tech uptrends remain intact, just lower their weight and make room for less volatile trends in financials.</li>
</ul>


CTAs are positioned in Asia uptrends, but the stocks that support it are losing momentum.
We uncovered stocks that sit outside the CTA trade that may be less vulnerable to outflows.
Tech uptrends remain intact, just lower their weight and make room for less volatile trends in financials.


CTA Trend Picks in Taiwan, South Korea, and Japan

Taiwan Tech Focused Senior Analyst

Patrick Liao

<ul>
<li>TSMC (2330) Sets New Record in 1Q26 with EPS of NT$22.08, Upgrading Full-Year USD Revenue Growth to Over 30%.</li>
<li>From a product mix perspective, advanced processes continue to drive this quarter’s growth and profitability.</li>
<li>Chairman stated that with sustained strong demand for advanced processes and robust AI momentum, even amid macroeconomic and geopolitical uncertainties.</li>
</ul>


TSMC (2330) Sets New Record in 1Q26 with EPS of NT$22.08, Upgrading Full-Year USD Revenue Growth to Over 30%.
From a product mix perspective, advanced processes continue to drive this quarter’s growth and profitability.
Chairman stated that with sustained strong demand for advanced processes and robust AI momentum, even amid macroeconomic and geopolitical uncertainties.


TSMC (2330.TT; TSM.US): 1Q26 with EPS of NT$22.1, with Full-Year USD Revenue Growth Over 30%.

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

<ul>
<li>
Record 66.2% gross margin beat guidance by 120bps; management raised full-year revenue growth to "above 30%" and capex to high end of $52-56B on insatiable AI demand. </li>
<li>
Supply constraints persist through 2027 as TSMC builds three new N3 fabs globally. AI accelerator revenue CAGR reaffirmed at "higher-50s" through 2029. </li>
<li>
Supply chain scorecard: strongly positive for ASML, SK Hynix,  ASE; mixed for MediaTek and Apple; negative for Intel and Samsung  foundry competitiveness.</li>
</ul>



Record 66.2% gross margin beat guidance by 120bps; management raised full-year revenue growth to "above 30%" and capex to high end of $52-56B on insatiable AI demand. 

Supply constraints persist through 2027 as TSMC builds three new N3 fabs globally. AI accelerator revenue CAGR reaffirmed at "higher-50s" through 2029. 

Supply chain scorecard: strongly positive for ASML, SK Hynix,  ASE; mixed for MediaTek and Apple; negative for Intel and Samsung  foundry competitiveness.


TSMC 1Q26: 66% Gross Margin Beat — What It Means for ASML, NVIDIA, MediaTek & 7 More

<ul>
<li>Very impressive. 1H26 revenue growth ~35%, Operating Profits growth ~58% YoY (guidance). 1H26 Net Income growth ~54% (my estimate). Consensus will keep revising up.</li>
<li>Capacity is tight, 2026 Capex will be at high-end of guidance ($56bn), TSMC announced 3 new N3 Fabs, “doing everything” they can to speed up capacity ramp.</li>
<li>TSMC and ASML trade at +1 stdev above average. TSMC is a lot cheaper trading at 20.4x forward EPS (forward means 12 months forward or April 2027) vs ASML 40x.</li>
</ul>


Very impressive. 1H26 revenue growth ~35%, Operating Profits growth ~58% YoY (guidance). 1H26 Net Income growth ~54% (my estimate). Consensus will keep revising up.
Capacity is tight, 2026 Capex will be at high-end of guidance ($56bn), TSMC announced 3 new N3 Fabs, “doing everything” they can to speed up capacity ramp.
TSMC and ASML trade at +1 stdev above average. TSMC is a lot cheaper trading at 20.4x forward EPS (forward means 12 months forward or April 2027) vs ASML 40x.


TSMC Keeps Beating. Consensus Expects 38% EPS Growth in 2026. 1H26 EPS Growth Is Above 50% YoY.

Taiwan

Taiwan Semiconductor Manufacturing Company Ltd. manufactures integrated circuits based on its proprietary designs.  The Company offers a comprehensive set of integrated circuit fabrication processes to manufacture CMOS logic, mixed-mode, volatile and non-volatile memory and BiCMOS chips.  Taiwan Semiconductor is an affiliate of Philips Electronics N.V.

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TSMC (Taiwan Semiconductor Manufacturing) (TSM US)

What to Do with Semi Stocks? The SOX Rally Is Not a Crazy Bubble.

The SOX index has surged 55% since March on strong earnings. Wide divergence in performance and valuations. Memory sector: high growth but low...

Nicolas Baratte

CTA Trend Picks in Taiwan, South Korea, and Japan

Trend followers are long Asian equities, but the mega-cap leaders are decelerating. If CTAs unwind, what survives? Hold strength at lower weights...

Damanick Dantes, CMT

TSMC (2330.TT; TSM.US): 1Q26 with EPS of NT$22.1, with Full-Year USD Revenue Growth Over 30%.

TSMC achieves record EPS in 1Q26, driven by strong demand for advanced processes and AI, upgrading full-year revenue growth to over 30%.

Patrick Liao

TSMC 1Q26: 66% Gross Margin Beat — What It Means for ASML, NVIDIA, MediaTek & 7 More

Record gross margin beat and raised revenue guidance due to AI demand; supply constraints persist through 2027 with TSMC building new fabs; supply...

Vincent Fernando, CFA

TSMC Keeps Beating. Consensus Expects 38% EPS Growth in 2026. 1H26 EPS Growth Is Above 50% YoY.

Impressive revenue and profit growth for TSMC, tight capacity leading to high Capex and new fabs, TSMC trading cheaper than ASML.

Nicolas Baratte

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

What to Do with Semi Stocks? The SOX Rally Is Not a Crazy Bubble.

​The SOX index has surged 55% since March on strong earnings. Wide divergence in performance and valuations. Memory sector: high growth but low...

Nicolas Baratte

CTA Trend Picks in Taiwan, South Korea, and Japan

Trend followers are long Asian equities, but the mega-cap leaders are decelerating. If CTAs unwind, what survives? Hold strength at lower weights...

Damanick Dantes, CMT

TSMC (2330.TT; TSM.US): 1Q26 with EPS of NT$22.1, with Full-Year USD Revenue Growth Over 30%.

​TSMC achieves record EPS in 1Q26, driven by strong demand for advanced processes and AI, upgrading full-year revenue growth to over 30%.

Patrick Liao

TSMC 1Q26: 66% Gross Margin Beat — What It Means for ASML, NVIDIA, MediaTek & 7 More

​Record gross margin beat and raised revenue guidance due to AI demand; supply constraints persist through 2027 with TSMC building new fabs; supply...

Vincent Fernando, CFA

TSMC Keeps Beating. Consensus Expects 38% EPS Growth in 2026. 1H26 EPS Growth Is Above 50% YoY.

​Impressive revenue and profit growth for TSMC, tight capacity leading to high Capex and new fabs, TSMC trading cheaper than ASML.

Nicolas Baratte

The SOX index has surged 55% since March on strong earnings. Wide divergence in performance and valuations. Memory sector: high growth but low...

TSMC achieves record EPS in 1Q26, driven by strong demand for advanced processes and AI, upgrading full-year revenue growth to over 30%.

Record gross margin beat and raised revenue guidance due to AI demand; supply constraints persist through 2027 with TSMC building new fabs; supply...

Impressive revenue and profit growth for TSMC, tight capacity leading to high Capex and new fabs, TSMC trading cheaper than ASML.