Tower Semiconductor Ltd. Ordinary Shares (TSEM)

FairStock Score: 40/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a Buffett-style investor, I want an understandable business, honest management, and a fair price. Tower is an independent semiconductor foundry that provides customizable process technologies and platforms. In the latest filed quarter, fiscal Q2 2026, revenue was $460.1M and net income was $90.8M, a 19.73% net margin. That is a real business, and the balance sheet looks conservative: debt-to-equity is 0.05, Altman Z-score is 20.73, and Piotroski F-score is 7/9. Positive trailing free cash flow of $300.6M is also encouraging. But the price is the problem. At the 2026-10-13 close of $222.20, FairStock calculates a P/E of 87.83, P/B of 8.14, EV/EBITDA of 35.98, and FCF yield of only 1.3%. The Graham Number is $39.42, leaving a margin of safety of negative 463.67%. Return on equity is 9.98% and return on capital employed is 4.95%, which are not the hallmarks of a wide-moat, high-return business. The FairStock Score is 37/100. Its computed Lynch category is none, because only 0 years of filed results are available and the rules need 3. The latest quarter shows revenue and profit, but one quarter is not a long track record. I would want a much lower price before calling this a value opportunity. At this valuation, the stock already assumes substantial future growth.

In plain English: Tower makes special chips for other companies. It is profitable, has little debt, and recent sales and profit were solid, but the stock price is very high compared with the money it earns and its cash flow. The business looks decent; the shares look expensive.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer