TSEC (TWSE:6443) - Share price, News & Analysis

Q: What is the Fair Price of 6443 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

6443 (NT$36.55) is trading below our estimate of [[fair value]] (NT$123.87)

6443 fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	5/6
Past Performance	5/6
Financial Health	5/6
Dividends	0/6

6443 Stock Overview

TSEC Corporation engages in the design, manufacture, and sale of solar cells and modules in Taiwan, Japan, the United States, Europe, China, and internationally.

Rewards

Trading at 70.5% below our estimate of its fair value

Earnings are forecast to grow 60.66% per year

Earnings grew by 576.1% over the past year

Risk Analysis

Volatile share price over the past 3 months

TSEC Competitors

Sunplus Technology

TWSE:2401

NT$15.4b

ADATA Technology

TPEX:3260

NT$15.6b

Holtek Semiconductor

TWSE:6202

NT$17.0b

Etron Technology

TPEX:5351

NT$13.9b

Price History & Performance

Summary of all time highs, changes and price drops for TSEC
Historical stock prices
Current Share Price	NT$36.55
52 Week High	NT$50.40
52 Week Low	NT$26.25
Beta	1.91
1 Month Change	13.69%
3 Month Change	0%
1 Year Change	29.84%
3 Year Change	328.99%
5 Year Change	160.20%
Change since IPO	6.97%

Shareholder Returns

	6443	TW Semiconductor	TW Market
7D	0.4%	3.5%	2.5%
1Y	29.8%	-13.7%	-7.1%

Return vs Industry: 6443 exceeded the TW Semiconductor industry which returned -13.7% over the past year.

Return vs Market: 6443 exceeded the TW Market which returned -7.1% over the past year.

Price Volatility

Is 6443's price volatile compared to industry and market?
6443 volatility
6443 Average Weekly Movement	7.3%
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: 6443 is more volatile than 75% of TW stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: 6443's weekly volatility (7%) has been stable over the past year, but is still higher than 75% of TW stocks.

About the Company

Founded	Employees	CEO	Website
2010	n/a	Cheng-Ren Hung	https://www.tsecpv.com

TSEC Corporation engages in the design, manufacture, and sale of solar cells and modules in Taiwan, Japan, the United States, Europe, China, and internationally. It is also involved in power plant construction and operation services; rental of solar power generating equipment; sale of self-generated electricity; and provision of energy technology services. The company was incorporated in 2010 and is headquartered in New Taipei City, Taiwan.

TSEC Fundamentals Summary

How do TSEC's earnings and revenue compare to its market cap?
6443 fundamental statistics
Market Cap	NT$16.29b
Earnings (TTM)	NT$181.83m
Revenue (TTM)	NT$7.55b

89.6x

P/E Ratio

2.2x

P/S Ratio

Is 6443 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
6443 income statement (TTM)
Revenue	NT$7.55b
Cost of Revenue	NT$6.93b
Gross Profit	NT$618.23m
Other Expenses	NT$436.40m
Earnings	NT$181.83m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.41
Gross Margin	8.19%
Net Profit Margin	2.41%
Debt/Equity Ratio	49.0%

How did 6443 perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is 6443 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

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 6443?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 6443. This is calculated by dividing 6443's market cap by their current preferred multiple.
What is 6443's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	NT$16.29b

6443 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	2.4x
Enterprise Value/EBITDA	23.6x
PEG Ratio	1.5x

Price to Earnings Ratio vs Peers

How does 6443's PE Ratio compare to its peers?

6443 PE Ratio vs Peers

The above table shows the PE ratio for 6443 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	15.3x
2401 Sunplus Technology	15.3x	n/a	NT$15.4b
3260 ADATA Technology	26.1x	n/a	NT$15.6b
6202 Holtek Semiconductor	8.3x	-16.4%	NT$17.0b
5351 Etron Technology	11.4x	n/a	NT$13.9b
6443 TSEC	89.6x	60.7%	NT$16.3b

Price-To-Earnings vs Peers: 6443 is expensive based on its Price-To-Earnings Ratio (89.6x) compared to the peer average (15.3x).

Price to Earnings Ratio vs Industry

How does 6443's PE Ratio compare vs other companies in the TW Semiconductor Industry?

Price-To-Earnings vs Industry: 6443 is expensive based on its Price-To-Earnings Ratio (89.6x) compared to the TW Semiconductor industry average (12.7x)

Price to Earnings Ratio vs Fair Ratio

What is 6443'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.

6443 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	89.6x
Fair PE Ratio	40.5x

Price-To-Earnings vs Fair Ratio: 6443 is expensive based on its Price-To-Earnings Ratio (89.6x) compared to the estimated Fair Price-To-Earnings Ratio (40.5x).

Share Price vs Fair Value

What is the Fair Price of 6443 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 6443 (NT$36.55) is trading below our estimate of fair value (NT$123.87)

Significantly Below Fair Value: 6443 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: Insufficient data to show price forecast.

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Future Growth

How is TSEC forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

5/6

Future Growth Score 5/6

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

60.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 6443's forecast earnings growth (60.7% per year) is above the savings rate (0.7%).

Earnings vs Market: 6443's earnings (60.7% per year) are forecast to grow faster than the TW market (6.1% per year).

High Growth Earnings: 6443's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 6443's revenue (22% per year) is forecast to grow faster than the TW market (7.3% per year).

High Growth Revenue: 6443's revenue (22% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 6443's Return on Equity is forecast to be low in 3 years time (16.7%).

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Past Performance

How has TSEC performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

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

43.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 6443 has high quality earnings.

Growing Profit Margin: 6443's current net profit margins (2.4%) are higher than last year (0.5%).

Past Earnings Growth Analysis

Earnings Trend: 6443 has become profitable over the past 5 years, growing earnings by 43.5% per year.

Accelerating Growth: 6443's earnings growth over the past year (576.1%) exceeds its 5-year average (43.5% per year).

Earnings vs Industry: 6443 earnings growth over the past year (576.1%) exceeded the Semiconductor industry 50.7%.

Return on Equity

High ROE: 6443's Return on Equity (3.5%) is considered low.

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Financial Health

How is TSEC's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

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

Financial Position Analysis

Short Term Liabilities: 6443's short term assets (NT$3.6B) do not cover its short term liabilities (NT$3.7B).

Long Term Liabilities: 6443's short term assets (NT$3.6B) exceed its long term liabilities (NT$1.7B).

Debt to Equity History and Analysis

Debt Level: 6443's net debt to equity ratio (34.2%) is considered satisfactory.

Reducing Debt: 6443's debt to equity ratio has reduced from 107.7% to 49% over the past 5 years.

Debt Coverage: 6443's debt is well covered by operating cash flow (27.5%).

Interest Coverage: 6443's interest payments on its debt are well covered by EBIT (3.8x coverage).

Balance Sheet

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Dividend

What is TSEC current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

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

Dividend Yield vs Market

Notable Dividend: Unable to evaluate 6443's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 6443's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 6443's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 6443's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as 6443 has not reported any payouts.

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Management

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

7.0yrs

Average management tenure

CEO

Cheng-Ren Hung

10.08yrs

Tenure

NT$5,140,000

Compensation

Mr. Cheng-Ren Hung is President at TSEC Corporation since July 05, 2012. His Major education and industry background includes Ph D in Chemistry, University of Missouri-Rolla Vice President, Powertec Energ...

CEO Compensation Analysis

Compensation vs Market: Cheng-Ren's total compensation ($USD171.32K) is about average for companies of similar size in the TW market ($USD175.01K).

Compensation vs Earnings: Cheng-Ren's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: 6443's management team is seasoned and experienced (7 years average tenure).

Board Members

Experienced Board: 6443's board of directors are considered experienced (8.3 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