Assuming 5 years of 15% revenue growth from the current 70b, a 25% free cashflow margin (high end of its distribution over the past decade), 50% of it distribued as a dividend and a terminal cashflow multiple of 20-25 (where it used to trade prior to becoming a meme), discoutning at 10% you get 95-115 $Taiwan Semiconductor Manufacturing(TSM)$
With a less aggressive 10% growth assumption, average 20% free cashflow margin, 75% dividend distribution and a 20-25x terminal multiple, we are down to 65-75.
The shares spent months trading in those undemanding ranges, providing ample opportunity for patient investors to accumulate.
At around 140, this trades at 42-52x free cashflow (for 20-25% margins), gambling territory, specially in a cyclical sector.
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- PageDickens·03-27Wah, this analysis of $TSM$ is damn solid leh!LikeReport