ELAN Microelectronics (TWSE:2458) - Share price, News & Analysis

Q: What is the Fair Price of 2458 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

2458 (NT$103) is trading below our estimate of [[fair value]] (NT$205.58)

2458 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	2/6
Financial Health	6/6
Dividends	3/6

2458 Stock Overview

Rewards

Trading at 49.9% below our estimate of its fair value

Risk Analysis

Earnings are forecast to decline by an average of 4.1% per year for the next 3 years

Dividend of 13.11% is not well covered by earnings or forecast to be in the next 3 years

High level of non-cash earnings

ELAN Microelectronics Competitors

Taiwan Surface Mounting Technology

TWSE:6278

NT$29.7b

AP Memory Technology

TWSE:6531

NT$33.3b

ENNOSTAR

TWSE:3714

NT$35.5b

uPI Semiconductor

TWSE:6719

NT$24.6b

Price History & Performance

Summary of all time highs, changes and price drops for ELAN Microelectronics
Historical stock prices
Current Share Price	NT$103.00
52 Week High	NT$181.50
52 Week Low	NT$97.80
Beta	0
1 Month Change	-3.29%
3 Month Change	-29.93%
1 Year Change	-34.81%
3 Year Change	25.76%
5 Year Change	69.45%
Change since IPO	-58.09%

Shareholder Returns

	2458	TW Semiconductor	TW Market
7D	5.3%	3.5%	2.5%
1Y	-34.8%	-13.7%	-7.1%

Return vs Industry: 2458 underperformed the TW Semiconductor industry which returned -13.7% over the past year.

Return vs Market: 2458 underperformed the TW Market which returned -7.1% over the past year.

Price Volatility

Is 2458's price volatile compared to industry and market?
2458 volatility
2458 Average Weekly Movement	5.3%
Semiconductor Industry Average Movement	6.5%
Market Average Movement	5.0%
10% most volatile stocks in TW Market	8.4%
10% least volatile stocks in TW Market	2.5%

Stable Share Price: 2458 is not significantly more volatile than the rest of TW stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: 2458's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1994	n/a	I-Hau Yeh	https://www.emc.com.tw

ELAN Microelectronics Corporation, a semiconductor company, produces and sells human-machine interface solutions for notebook PCs, smartphones, tablets, and consumer electronics applications in Taiwan, Mainland China, Hong Kong, and the United States. It offers fingerprint sensors, including biometric smart cards, pad and button modules, key cap fingerprint modules, biometric USB dongles, under display fingerprint sensors, and fingerprint sensor with coating/cover glass, as well as facial recognition solutions for PC and smartphone devices. The company also provides microcontrollers for general purpose, touch key, PC peripheral, calculator, and telecommunication applications; pen and touch input solutions for laptops and mobiles; and pointstick and touchpad solutions.

ELAN Microelectronics Fundamentals Summary

How do ELAN Microelectronics's earnings and revenue compare to its market cap?
2458 fundamental statistics
Market Cap	NT$29.31b
Earnings (TTM)	NT$4.26b
Revenue (TTM)	NT$17.38b

6.9x

P/E Ratio

1.7x

P/S Ratio

Is 2458 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
2458 income statement (TTM)
Revenue	NT$17.38b
Cost of Revenue	NT$8.88b
Gross Profit	NT$8.50b
Other Expenses	NT$4.24b
Earnings	NT$4.26b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	14.99
Gross Margin	48.92%
Net Profit Margin	24.53%
Debt/Equity Ratio	0.9%

How did 2458 perform over the long term?

See historical performance and comparison

Dividends

13.1%

Current Dividend Yield

90%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 2458 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 2458?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 2458. This is calculated by dividing 2458's market cap by their current preferred multiple.
What is 2458's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	NT$29.31b

2458 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.3x
Enterprise Value/EBITDA	4.4x
PEG Ratio	-1.7x

Price to Earnings Ratio vs Peers

How does 2458's PE Ratio compare to its peers?

2458 PE Ratio vs Peers

The above table shows the PE ratio for 2458 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	12.2x
6278 Taiwan Surface Mounting Technology	6.6x	20.8%	NT$29.7b
6531 AP Memory Technology	13.9x	1.8%	NT$33.3b
3714 ENNOSTAR	12.3x	0.7%	NT$35.5b
6719 uPI Semiconductor	16.1x	4.2%	NT$24.6b
2458 ELAN Microelectronics	6.9x	-4.1%	NT$29.3b

Price-To-Earnings vs Peers: 2458 is good value based on its Price-To-Earnings Ratio (6.9x) compared to the peer average (12.2x).

Price to Earnings Ratio vs Industry

How does 2458's PE Ratio compare vs other companies in the TW Semiconductor Industry?

Price-To-Earnings vs Industry: 2458 is good value based on its Price-To-Earnings Ratio (6.9x) compared to the TW Semiconductor industry average (12.7x)

Price to Earnings Ratio vs Fair Ratio

What is 2458's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

2458 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	6.9x
Fair PE Ratio	10.4x

Price-To-Earnings vs Fair Ratio: 2458 is good value based on its Price-To-Earnings Ratio (6.9x) compared to the estimated Fair Price-To-Earnings Ratio (10.4x).

Share Price vs Fair Value

What is the Fair Price of 2458 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 2458 (NT$103) is trading below our estimate of fair value (NT$205.58)

Significantly Below Fair Value: 2458 is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

Discover undervalued companies

Future Growth

How is ELAN Microelectronics forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-4.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 2458's earnings are forecast to decline over the next 3 years (-4.1% per year).

Earnings vs Market: 2458's earnings are forecast to decline over the next 3 years (-4.1% per year).

High Growth Earnings: 2458's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 2458's revenue is expected to decline over the next 3 years (-1.2% per year).

High Growth Revenue: 2458's revenue is forecast to decline over the next 3 years (-1.2% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 2458's Return on Equity is forecast to be high in 3 years time (32%)

Discover growth companies

Past Performance

How has ELAN Microelectronics performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

34.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 2458 has a high level of non-cash earnings.

Growing Profit Margin: 2458's current net profit margins (24.5%) are lower than last year (25.3%).

Past Earnings Growth Analysis

Earnings Trend: 2458's earnings have grown significantly by 34.5% per year over the past 5 years.

Accelerating Growth: 2458's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 2458 had negative earnings growth (-9.1%) over the past year, making it difficult to compare to the Semiconductor industry average (50.7%).

Return on Equity

High ROE: 2458's Return on Equity (49.3%) is considered outstanding.

Discover strong past performing companies

Financial Health

How is ELAN Microelectronics's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 2458's short term assets (NT$14.2B) exceed its short term liabilities (NT$9.2B).

Long Term Liabilities: 2458's short term assets (NT$14.2B) exceed its long term liabilities (NT$1.2B).

Debt to Equity History and Analysis

Debt Level: 2458 has more cash than its total debt.

Reducing Debt: 2458's debt to equity ratio has reduced from 3.6% to 0.9% over the past 5 years.

Debt Coverage: 2458's debt is well covered by operating cash flow (4526.1%).

Interest Coverage: 2458 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

Discover healthy companies

Dividend

What is ELAN Microelectronics's current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

13.11%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 2458's dividend (13.11%) is higher than the bottom 25% of dividend payers in the TW market (2.47%).

High Dividend: 2458's dividend (13.11%) is in the top 25% of dividend payers in the TW market (6.47%)

Stability and Growth of Payments

Stable Dividend: 2458's dividend payments have been volatile in the past 10 years.

Growing Dividend: 2458's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its high payout ratio (90.5%), 2458's dividend payments are not well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (116.9%), 2458's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

21.8yrs

Average management tenure

CEO

I-Hau Yeh (66 yo)

27.92yrs

Tenure

Mr. I-Hau Yeh serves as the President, CEO and Chairman of the Board of Directors of Elan Microelectronics Corporation. Mr. Yeh had been Manager of Huazhan Semiconductor Co., Ltd.; Director of Hualong Micr...

Leadership Team

Experienced Management: 2458's management team is seasoned and experienced (21.8 years average tenure).

Board Members

Experienced Board: 2458's board of directors are considered experienced (7.2 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/17 00:00
End of Day Share Price	2022/08/17 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31