# Tower Semiconductor (TSEM.US)

Canonical: https://gigainvestors.com/s/TSEM

Analysis as of: 2026-10-16T07:32:33.480Z. Financial observations: FY1996–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $209.80 per share; close as of 2026-10-15.

Estimated value: low $33.91 per share, central $38.61 per share, high $42.90 per share. Buy at or below the central value $38.61 per share. Valuation as of 2026-10-16T07:32:33.480Z; scenarios are not confidence intervals.

Expected annual return: 3.9% at the stated quote. About 3.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 0

- Operating margin variation: 0.56×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.16×

- FY2018: 0.12×

- FY2019: 0.07×

- FY2020: 0.07×

- FY2021: 0.11×

- FY2022: 0.19×

- FY2023: 0.38×

- FY2024: 0.13×

- FY2025: 0.12×

- LTM to Jun 2026: 0.16×

### moat: fail

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 15.8%

- ROIC, second-lowest year: 9.2%

- Typical minus recent gross margin: 0.2 pp

- Typical gross margin (annual median): 23.4%

- Recent gross margin (lower of latest and 3-year median): 23.2%

- Years with nonpositive capital: 0

- Capital spending / revenue: 21.3%

- ROIC including acquisitions, ten-year median: 14.1%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 27.6%

- FY2017: 27.6%

- FY2018: 17.4%

- FY2019: 9.2%

- FY2020: 7.6%

- FY2021: 14.2%

- FY2022: 24.7%

- FY2023: 34.2%

- FY2024: 11.3%

- FY2025: 9.2%

### economics: fail

- owner earnings cash conversion below threshold

- Owner earnings / net income, 5-yr: 0.72×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $983M

- Net income, five-year total: $1.4B

- Return on incremental invested capital: 12.8%

- Working capital / revenue, annual change: 1.2 pp

- Working capital / revenue, change between three-year averages: 8.8 pp

- Working capital / revenue, final three-year average: 23.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.00×

- FY2022: 1.00×

- FY2023: 0.64×

- FY2024: 0.23×

- FY2025: 0.85×

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 27.6% vs 11.3%

- Per-share earnings: 2.01 to 1.94 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 2.5%

- Ordinary dilution, 5-year annual growth: 0.9%

- Market cap gain: $11B

- Cumulative retained earnings: $2.0B

- Diluted shares, 10-year annual growth: 2.5%

- Diluted shares, 5-year annual growth: 0.9%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -0.5%

- Per-share value change: -$0.07

- Per-share value, starting three-year median: $2.01

- Per-share value, ending three-year median: $1.94

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: $1.5M

- Cumulative net income, 10 years: $2.2B

- ROIC, first three-year median: 27.6%

- ROIC, last three-year median: 11.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: $2.01

- FY2017: $2.81

- FY2018: $1.32

- FY2019: $0.84

- FY2020: $0.76

- FY2021: $1.37

- FY2022: $2.39

- FY2023: $4.66

- FY2024: $1.85

- FY2025: $1.94

### accounting: pass

- restructuring or one-time charges in at least three of five years

- Sloan accruals: -5.3%

- Receivables to sales index (DSRI): 0.85×

- Restructuring years, last five: 3

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.79×

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.00×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -9.0%

- FY2017: -3.4%

- FY2018: -9.9%

- FY2019: -10.4%

- FY2020: -9.3%

- FY2021: -12.2%

- FY2022: -10.4%

- FY2023: -5.4%

- FY2024: -7.8%

- FY2025: -5.3%

## Holders

- [Lee Ainslie](https://gigainvestors.com/mc): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 29.1% a year for ten years · sales +9.2%

Story as of 2026-10-16T09:59:43.800Z; price observation 2026-10-15.

Price needs cash profits to grow 29.1% a year for ten years

- 2025-08-04: Tower Semiconductor beats top-line and bottom-line estimates; initiates Q3 outlook ([seekingalpha.com](https://seekingalpha.com/news/4477161-tower-semiconductor-beats-top-line-and-bottom-line-estimates-initiates-q3-outlook?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2025-09-08: Tower Semiconductor (TSEM) Is Up 7.5% After On-Chip Multi-Wavelength Laser Breakthrough for AI Datacenters ([finance.yahoo.com](https://finance.yahoo.com/news/tower-semiconductor-tsem-7-5-141133150.html))

- 2025-11-10: Tower Semiconductor posts upbeat revenue forecasts on data-center boom, shares rise ([finance.yahoo.com](https://finance.yahoo.com/news/tower-semiconductor-forecasts-quarterly-revenue-132646475.html))

- 2026-03-25: Tower Semiconductor (TSEM) Is Up 31.2% After Expanding Its AI Data Center Chip Portfolio ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/tower-semiconductor-tsem-31-2-001709391.html))

- 2026-05-18: Tower Semiconductor (TSEM) Signs $1.3B Silicon Photonics Customer Contracts for 2027 Revenue ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/tower-semiconductor-tsem-signs-1-143800359.html))

- 2026-09-18: Why Tower Semiconductor (TSEM) Is Up 5.4% After New AI-Focused Silicon Photonics Shipment Milestone ([finance.yahoo.com](https://finance.yahoo.com/technology/ai/articles/why-tower-semiconductor-tsem-5-031518331.html))

### Sales · FY2025–2026

sales +9.2%; source https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm; observed 2026-04-30.

- FY2017: $1.4B 

- FY2018: $1.3B 

- FY2019: $1.2B 

- FY2020: $1.3B 

- FY2021: $1.5B 

- FY2022: $1.7B 

- FY2023: $1.4B 

- FY2024: $1.4B 

- FY2025: $1.6B 

- FY2026: $1.7B 

### Gross margin · FY2025

gross margin 23.2%; source https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm; observed 2026-04-30.

- FY2016: 24.3% 

- FY2017: 25.5% 

- FY2018: 22.5% 

- FY2019: 18.6% 

- FY2020: 18.4% 

- FY2021: 21.8% 

- FY2022: 27.8% 

- FY2023: 24.8% 

- FY2024: 23.6% 

- FY2025: 23.2% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in semiconductors; annual sales are USD 1.6 billion.

- Source: https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm (filed 2026-04-30); FY2025: revenue 1566104000; grossProfit 363854000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TSEM.US: Tower Semiconductor Ltd., an independent semiconductor foundry, provides technology, development, and process platforms for integrated circuits in the United States, Japan, rest of Asia, and Europe. It provides customizable process technologies, including SiGe, SiPho, mixed signal CMOS, RF CMOS, CMOS image sensors, non-imaging sensors, wafers, and integrated power management. The company also offers a design enablement platform for a design cycle, as well as transfer optimization and development process services to integrated device manufacturers and fabless companies. It serves consumer applications, personal computers, communications, handsets and smartphones, automotive, industrial, aerospace, and medical device markets. The company was incorporated in 1993 and is headquartered in Migdal Haemek, Israel.

### Why customers stay

Margins ranged from 23.2% to 24.8% during 2023–25; it earns 15.8% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2023: grossProfit / revenue = 24.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2024: grossProfit / revenue = 23.6%.

- Source: https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm (filed 2026-04-30); FY2025: grossProfit / revenue = 23.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); 10-year return on capital observations [[2016,0.2759280975546106],[2017,0.2756459766886673],[2018,0.17418550069046507],[2019,0.09199770947148368],[2020,0.07558967755266063],[2021,0.1418652814743208],[2022,0.24719564470841524],[2023,0.3419090478697088],[2024,0.11332973331359747],[2025,0.0919662125710695]]; median 0.15802539108239294. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Spends 53.8% of cash earnings on expansion; earns 12.8% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2016: growth capex 19890000; upkeep 197606000; owner earnings 203924000. Growth capex / owner earnings = 0.09753633706675036.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2017: growth capex 0; upkeep 187676000; owner earnings 318746000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2018: growth capex 0; upkeep 210192000; owner earnings 139778000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2019: growth capex 0; upkeep 191396000; owner earnings 113126000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2020: growth capex 17110248.807774425; upkeep 296545751.1922256; owner earnings 26287248.807774425. Growth capex / owner earnings = 0.6508953802238174.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2021: growth capex 43098000; upkeep 270710000; owner earnings 150012000. Growth capex / owner earnings = 0.2872970162387009.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2022: growth capex 73765000; upkeep 292638000; owner earnings 264569000. Growth capex / owner earnings = 0.27881195453737967.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2023: growth capex 0; upkeep 444502000; owner earnings 332013000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); FY2024: growth capex 9595371.484800458; upkeep 426557628.51519954; owner earnings 47585371.48480046. Growth capex / owner earnings = 0.20164540457281868.

- Source: https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm (filed 2026-04-30); FY2025: growth capex 101399276.72362071; upkeep 335161723.2763793; owner earnings 188420276.7236207. Growth capex / owner earnings = 0.5381548020564451.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); Incremental return on capital 0.127906371406937, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); Dividend observations: [[2016,2563000],[2017,4378000],[2018,0],[2019,0],[2020,0],[2021,0],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 0.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TSEM.US SharesStats.PercentInsiders = 0.39699999999999996 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 29.1% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-30); Ten-year compound average after fade. Initial solved rate 0.41389084119460906. Price 209.8; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -0.3033044846577498 → FY2025 1.6586729994948872. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $15.55 per share

- 2016-11: $17.96 per share

- 2016-12: $19.03 per share

- 2017-01: $21.21 per share

- 2017-02: $22.95 per share

- 2017-03: $23.05 per share

- 2017-04: $21.52 per share

- 2017-05: $25.36 per share

- 2017-06: $23.85 per share

- 2017-07: $26.15 per share

- 2017-08: $30.21 per share

- 2017-09: $30.75 per share

- 2017-10: $33.06 per share

- 2017-11: $35.21 per share

- 2017-12: $34.08 per share

- 2018-01: $34.74 per share

- 2018-02: $29.02 per share

- 2018-03: $26.91 per share

- 2018-04: $25.87 per share

- 2018-05: $25.92 per share

- 2018-06: $22.01 per share

- 2018-07: $20.65 per share

- 2018-08: $21.80 per share

- 2018-09: $21.76 per share

- 2018-10: $15.69 per share

- 2018-11: $15.76 per share

- 2018-12: $14.74 per share

- 2019-01: $14.89 per share

- 2019-02: $17.93 per share

- 2019-03: $16.56 per share

- 2019-04: $17.97 per share

- 2019-05: $14.90 per share

- 2019-06: $15.77 per share

- 2019-07: $19.67 per share

- 2019-08: $19.03 per share

- 2019-09: $19.24 per share

- 2019-10: $21.93 per share

- 2019-11: $21.92 per share

- 2019-12: $24.06 per share

- 2020-01: $22.18 per share

- 2020-02: $19.77 per share

- 2020-03: $15.92 per share

- 2020-04: $19.24 per share

- 2020-05: $20.11 per share

- 2020-06: $19.09 per share

- 2020-07: $21.50 per share

- 2020-08: $19.46 per share

- 2020-09: $18.22 per share

- 2020-10: $21.10 per share

- 2020-11: $24.46 per share

- 2020-12: $25.82 per share

- 2021-01: $27.97 per share

- 2021-02: $29.39 per share

- 2021-03: $28.04 per share

- 2021-04: $28.30 per share

- 2021-05: $27.47 per share

- 2021-06: $29.43 per share

- 2021-07: $27.85 per share

- 2021-08: $29.40 per share

- 2021-09: $29.90 per share

- 2021-10: $31.87 per share

- 2021-11: $35.48 per share

- 2021-12: $39.68 per share

- 2022-01: $34.35 per share

- 2022-02: $46.85 per share

- 2022-03: $48.40 per share

- 2022-04: $48.30 per share

- 2022-05: $48.26 per share

- 2022-06: $46.18 per share

- 2022-07: $47.86 per share

- 2022-08: $46.39 per share

- 2022-09: $43.94 per share

- 2022-10: $42.76 per share

- 2022-11: $44.57 per share

- 2022-12: $43.20 per share

- 2023-01: $41.79 per share

- 2023-02: $40.56 per share

- 2023-03: $42.47 per share

- 2023-04: $45.01 per share

- 2023-05: $39.14 per share

- 2023-06: $37.52 per share

- 2023-07: $37.75 per share

- 2023-08: $29.70 per share

- 2023-09: $24.56 per share

- 2023-10: $23.02 per share

- 2023-11: $27.38 per share

- 2023-12: $30.52 per share

- 2024-01: $28.85 per share

- 2024-02: $32.88 per share

- 2024-03: $33.45 per share

- 2024-04: $32.87 per share

- 2024-05: $37.54 per share

- 2024-06: $39.31 per share

- 2024-07: $40.80 per share

- 2024-08: $44.19 per share

- 2024-09: $44.26 per share

- 2024-10: $41.96 per share

- 2024-11: $47.13 per share

- 2024-12: $51.51 per share

- 2025-01: $48.89 per share

- 2025-02: $42.50 per share

- 2025-03: $35.66 per share

- 2025-04: $35.78 per share

- 2025-05: $39.44 per share

- 2025-06: $43.35 per share

- 2025-07: $45.75 per share

- 2025-08: $58.82 per share

- 2025-09: $72.30 per share

- 2025-10: $85.17 per share

- 2025-11: $108.11 per share

- 2025-12: $117.42 per share

- 2026-01: $134.73 per share

- 2026-02: $124.87 per share

- 2026-03: $175.48 per share

- 2026-04: $221.05 per share

- 2026-05: $255.23 per share

- 2026-06: $260.64 per share

- 2026-07: $219.67 per share

- 2026-08: $205.05 per share

- 2026-09: $227.43 per share

- 2026-10: $209.80 per share

## Annual estimated value (USD per share)

- FY2017: low $28.38 per share, central $31.60 per share, high $35.89 per share

- FY2018: low $28.69 per share, central $31.82 per share, high $35.98 per share

- FY2019: low $20.18 per share, central $22.04 per share, high $24.51 per share

- FY2020: low $19.98 per share, central $21.87 per share, high $24.38 per share

- FY2021: low $21.62 per share, central $23.67 per share, high $26.42 per share

- FY2022: low $25.25 per share, central $27.52 per share, high $30.54 per share

- FY2023: low $25.51 per share, central $28.49 per share, high $31.40 per share

- FY2024: low $24.49 per share, central $26.40 per share, high $28.95 per share

- FY2025: low $27.99 per share, central $30.49 per share, high $33.82 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 20-F filing](https://www.sec.gov/Archives/edgar/data/928876/000117891326002318/zk2635149.htm); period 2025-12-31, filed 2026-04-30.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.