TSMC: A Foundry of Fortunes

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They say fortunes are built on sand. In this instance, it’s silicon. Taiwan Semiconductor Manufacturing, or TSM as the cognoscenti murmur, has recently enjoyed a surge—a rather impudent 61% ascent over the past year while the broader market merely strolled along at a respectable 14%. One might assume this leaves little room for further enrichment. One would be… mistaken. The trick, dear reader, isn’t simply owning a piece of the future, but recognizing the future is being fabricated, quite literally, in this very foundry. Let us examine the reasons why a prudent investor might still consider a foray into this peculiar enterprise.

1. The Artificial Intelligence Racket

Artificial intelligence. A phrase bandied about with the recklessness of a gambler discarding rubles. It’s still in its infancy, you understand, though the hype suggests a fully grown, demanding adolescent. The hyperscalers—those digital behemoths—are throwing money at it with the enthusiasm of a nouveau riche attempting to impress a countess. Hundreds of billions, they say. And where does all this capital ultimately land? Precisely. At TSM’s doorstep.

TSM isn’t bothered with the ideas behind artificial intelligence—those are for the dreamers and the academics. They simply manufacture the components—the tiny, intricate brains—upon which these dreams depend. Nvidia and Apple, those titans of technological vanity, are among their most devoted clients. Before the AI craze, they catered to the whims of smartphone addicts and gaming enthusiasts. A perfectly respectable business, of course, but AI—ah, that’s where the real potential resides. Currently, high-performance computing, including this AI folly, accounts for a rather substantial 58% of their revenue. Smartphones, a mere 29%. A clear sign of shifting priorities, wouldn’t you agree?

The beauty of TSM’s position, you see, is its timelessness. They don’t bet on the latest fad; they provide the foundation for all fads. They profit from every technological whim, every fleeting obsession. A truly remarkable feat, akin to a master pickpocket relieving a crowd of their wealth without anyone noticing.

2. A Profitable Scheme, Neatly Executed

AI is indeed generating excitement—and, naturally, a considerable amount of hot air—but TSM isn’t relying on mere speculation. This is a well-established enterprise, operating with an efficiency that would make a Swiss watchmaker envious. In the last quarter of 2025, their gross margin reached a robust 62.3%, a significant improvement over the previous year. Operating margin? A delightful 54%. These aren’t the figures of a speculative bubble, my friend; these are the earnings of a meticulously crafted scheme.

Management, with the customary air of understated confidence, acknowledges that capital expenditures will increase as they expand to meet the surging demand. But they assure us—with a knowing wink, no doubt—that these periods of intense investment are invariably followed by even more substantial growth. They’re not simply building a factory; they’re building a future—and charging a handsome fee for the privilege.

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3. A Price Worth Paying

TSM’s revenue increased by a respectable 26% year-over-year in the last quarter, and earnings per share jumped by an even more impressive 35%. A robust performance, to be sure, and all indications suggest this momentum will continue.

Yet, despite these impressive figures, TSM stock currently trades at a mere 18 times forward earnings. An astonishingly attractive price, considering the company’s profitability and growth prospects. It’s as if the market is deliberately overlooking a treasure, perhaps distracted by the latest shiny bauble. A prudent investor, of course, would be wise to capitalize on this oversight. After all, fortunes aren’t simply made; they’re occasionally stumbled upon—especially when one knows where to look.

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2026-02-11 02:02