Taiwan Semiconductor Manufacturing Co. Ltd. 2330

Moat and Management hold this up; Optionality is the soft spot.

The price needs 13.2% growth a year for ten years. The AI thinks 23.0% is achievable, at a 49.0% margin.

TSMC is investing heavily today to lock in AI capacity that will generate higher cash flows for years. Once you adjust for that growth spending, the company only needs to grow around 18 % a year to justify its price, yet the AI boom and new US fabs make 23 % realistic. That gap, plus 61 % returns on capital, makes the stock attractive for long-term owners.

Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, manufactures, packages, tests, and sells integrated circuits and other semiconductor devices in Taiwan, China, Europe, the Middle East, Africa, Japan, the United States, and internationally. It provides various wafer fabrication processes, such as processes to manufacture complementary metal- oxide-semiconductor (CMOS) logic, mixed-signal, radio frequency, embedded memory, bipolar CMOS mixed-signal, and others. The company also involved in providing customer and engineering support services; manufacturing of masks; investment in technology start-up companies; research, designing, developing, manufacturing, packaging, testing, and sale of color filters; and investment activities. Its products are used in high performance computing, smartphones, Internet of things, automotive, and digital consumer electronics. Taiwan Semiconductor Manufacturing Company Limited was incorporated in 1987 and is headquartered in Hsinchu City, Taiwan.

Write why this business works, set your own fair value, and let the briefing speak only when a rule you wrote is crossed.