Nearly all covering analysts rate TSMC as a buy, with 98% of 49 firms recommending accumulation, yet the consensus target implies only 25% upside over the next 12–18 months. This contrasts with the highest price forecast of 59% above current levels. Given TSMC’s 54% gain in 2025, its dominant foundry position for leading-edge AI chips, and a track record of quarterly EPS beats (including a $0.16 surprise in Q4), the stock appears poised to outperform analyst projections and revisit lofty targets above $500.

TSMC delivered 2025 revenue of $122 billion, a 36% year-over-year increase, with fourth-quarter sales up 26%. Gross margin expanded from 59% to 62.3%, and operating margin rose from 49% to 54%. Management forecasts 30% top-line growth in 2026 and targets a compound annual growth rate of 25% through 2029. Wall Street expects EPS to climb from $10.65 in 2025 to $13.05 in 2026 (a 23% increase), reflecting strong alignment between guidance and consensus, while past beats suggest potential for further upside.

To support surging demand from hyperscale AI customers, TSMC plans to raise capital expenditure to approximately $54 billion in 2026, up from $41 billion in 2025. Between 70% and 80% of this budget is earmarked for advanced process technologies at 7 nm nodes and below. The company’s high-performance computing segment, driven by AI workloads, accounted for 58% of 2025 revenue and grew 48% year over year. This level of investment underscores management’s confidence in sustained demand and positions TSMC to maintain industry leadership in next-generation chip production.