TSMBULLISH

TSM Return on Equity (ROE) Analysis

40.0%

Higher than 82% of Technology sector peers

Updated 853h ago·SEC filings & market data

Key Takeaway

Return on equity (ROE) measures how much profit a company generates from each dollar of shareholders’ equity; at 40.0%, TSM earns $0.40 per dollar of equity, a high return for any business.

Sector Performance

82th percentile

TSM

40.0%

Sector Median

9.1%

Sector Avg

-3.2%

Prior Period

36.2%(Jul 2026)

↑ Improving

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Deep Analysis

Return on equity (ROE) measures how much profit a company generates from each dollar of shareholders’ equity; at 40.0%, TSM earns $0.40 per dollar of equity, a high return for any business.

That level far exceeds the sector median of 8.7%, placing the company in the 82nd percentile among technology peers, meaning only about 18% of comparable firms show higher profitability. Trend data is unavailable: no year-over-year change, quarter-over-quarter change, or eight-quarter history was provided, and the single historical value of 40.0% offers no basis to judge direction. The combination of an exceptionally high ROE with an unknown trend leaves the quality of current earnings clear but the sustainability unproven. This level supports the BULLISH verdict because the profitability gap over peers is wide, although the lack of trend information means the outlook rests on this single snapshot. The metric does not contradict the overall positive assessment, but an investor should seek additional data on earnings momentum before relying on it.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about TSM?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does TSM's Return on Equity (ROE) compare to its sector?

TSM's Return on Equity (ROE) of 40.0% compares to a Technology sector median of 9.1%, placing it in the 82th percentile.

Who are TSM's closest peers by Return on Equity (ROE)?

The closest Technology peers by Return on Equity (ROE) include: AFRM (1.7%), SQ (0.0%), CRWD (-0.2%), MDB (-1.0%), APLD (-5.6%).

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Learn More About Return on Equity (ROE)

What Is Return on Equity (ROE) and Is Higher Always Better?

Return on equity ROE measures how efficiently a company generates profit from shareholder capital. Learn how to decompose ROE using DuPont analysis and why high leverage can make it dangerous—with Apple and JPMorgan examples.

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.