TAIWAN SEMICONDUCTOR-SP ADR (NYSE:TSM) – A Strong Contender for CANSLIM Investors

TAIWAN SEMICONDUCTOR-SP ADR (NYSE:TSM) stands out as a compelling candidate for investors following the CANSLIM strategy. The stock meets multiple key criteria of William O’Neil’s growth-focused approach, combining strong earnings momentum, high relative strength, and solid institutional backing. Below, we examine why TSM aligns with CANSLIM principles.

Key CANSLIM Criteria Met by TSM

• Earnings Growth (C & A Criteria)

  • Quarterly EPS growth (Q2Q) of 60.2%, well above the 20% minimum suggested by CANSLIM.
  • Revenue growth (Q2Q) of 41.6%, exceeding the 25% threshold.
  • Three-year EPS growth of 25.3%, demonstrating consistent annual earnings expansion.

• Return on Equity (A Criteria)

  • ROE of 28.7%, far surpassing the 10% benchmark, indicating efficient use of shareholder capital.

• Relative Strength (L Criteria)

  • A high relative strength score of 88, placing it in the top 12% of stocks in terms of price performance.

• Institutional Sponsorship (I Criteria)

  • Institutional ownership stands at 34.5%, below the 85% ceiling, suggesting room for further institutional accumulation.

• Debt Management (S Criteria)

  • A low debt-to-equity ratio of 0.21, reflecting a conservative balance sheet.

Technical Strength

TSM’s technical rating of 9/10 reflects a strong uptrend in both short-term and long-term timeframes. The stock is trading near its 52-week high, reinforcing its leadership position in the market. For a deeper technical breakdown, review the full technical report.

Valuation and Growth Outlook

While TSM trades at a premium valuation, its robust profitability and expected earnings growth of 22.9% justify the higher multiples. The company’s dominant position in semiconductor manufacturing supports sustained growth. For a detailed fundamental assessment, see the full fundamental report.

Our CANSLIM High Growth screener lists additional stocks that fit this strategy and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should always conduct your own analysis before making investment decisions.