Reported Earnings • May 13
First quarter 2026 earnings: Revenues exceed analysts expectations while EPS lags behind First quarter 2026 results: EPS: NT$1.00 (down from NT$1.02 in 1Q 2025). Revenue: NT$16.6b (up 47% from 1Q 2025). Net income: NT$301.6m (down 1.0% from 1Q 2025). Profit margin: 1.8% (down from 2.7% in 1Q 2025). The decrease in margin was driven by higher expenses. Revenue exceeded analyst estimates by 7.6%. Earnings per share (EPS) missed analyst estimates by 30%. Revenue is forecast to grow 20% p.a. on average during the next 2 years, compared to a 32% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has fallen by 25% per year but the company’s share price has only fallen by 3% per year, which means it has not declined as severely as earnings. Upcoming Dividend • Apr 02
Upcoming dividend of NT$2.50 per share Eligible shareholders must have bought the stock before 09 April 2026. Payment date: 14 May 2026. Payout ratio is a comfortable 62% but the company is not cash flow positive. Trailing yield: 3.1%. Lower than top quartile of Taiwanese dividend payers (5.3%). Higher than average of industry peers (1.2%). Major Estimate Revision • Mar 17
Consensus EPS estimates fall by 11%, revenue upgraded The consensus outlook for fiscal year 2026 has been updated. 2026 revenue forecast increased from NT$62.7b to NT$65.7b. EPS estimate fell from NT$7.29 to NT$6.49 per share. Net income forecast to grow 61% next year vs 82% growth forecast for Communications industry in Taiwan. Consensus price target down from NT$109 to NT$102. Share price rose 4.5% to NT$80.50 over the past week. Declared Dividend • Mar 12
Dividend reduced to NT$2.50 Dividend of NT$2.50 is 46% lower than last year. Ex-date: 9th April 2026 Payment date: 14th May 2026 Dividend yield will be 3.2%, which is higher than the industry average of 2.3%. Sustainability & Growth Dividend is not adequately covered by earnings (95% earnings payout ratio) and the company has no free cash flows available, indicating it may be using cash reserves or debt to pay the dividend. The dividend has increased by an average of 4.4% per year over the past 10 years. However, payments have been volatile during that time. The company's earnings per share (EPS) would need to grow by 5.1% to bring the payout ratio under control. EPS is expected to grow by 66% over the next 2 years, which is sufficient to bring the dividend into a sustainable range. Reported Earnings • Mar 11
Full year 2025 earnings released: EPS: NT$4.04 (vs NT$7.74 in FY 2024) Full year 2025 results: EPS: NT$4.04 (down from NT$7.74 in FY 2024). Revenue: NT$54.0b (down 4.9% from FY 2024). Net income: NT$1.20b (down 47% from FY 2024). Profit margin: 2.2% (down from 4.0% in FY 2024). The decrease in margin was driven by lower revenue. Revenue is forecast to grow 13% p.a. on average during the next 2 years, compared to a 30% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has fallen by 18% per year but the company’s share price has only fallen by 5% per year, which means it has not declined as severely as earnings. Valuation Update With 7 Day Price Move • Nov 07
Investor sentiment deteriorates as stock falls 16% After last week's 16% share price decline to NT$83.10, the stock trades at a forward P/E ratio of 11x. Average forward P/E is 15x in the Communications industry in Taiwan. Total returns to shareholders of 22% over the past three years. Simply Wall St's valuation model estimates the intrinsic value at NT$81.92 per share. Reported Earnings • Nov 02
Third quarter 2025 earnings released: EPS: NT$1.00 (vs NT$1.83 in 3Q 2024) Third quarter 2025 results: EPS: NT$1.00 (down from NT$1.83 in 3Q 2024). Revenue: NT$14.7b (up 9.6% from 3Q 2024). Net income: NT$296.3m (down 46% from 3Q 2024). Profit margin: 2.0% (down from 4.1% in 3Q 2024). The decrease in margin was driven by higher expenses. Revenue is forecast to grow 14% p.a. on average during the next 3 years, compared to a 25% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has fallen by 9% per year but the company’s share price has increased by 9% per year, which means it is well ahead of earnings. Announcement • Sep 15
Sercomm Corporation Showcases Next-Gen Rdk Video Accelerator Stb Based on Broadcom Bcm74116 At the Rdk Global Summit 2025 At the RDK Global Summit, Sercomm Corporation introduced its newest RDK Video Accelerator based on the latest Broadcom BCM74116 integrated System on Chip (SoC). This new STB will also use the latest RDK7 software release. RDK is an open-source software platform that standardizes core functions used in video and broadband devices. RDK enables service providers to control their device diagnostics data, business models, and apps to improve the customer experience and drive business results. The new Sercomm STB platform is designed to accelerate integration with operator user interfaces and video services, enabling speedier product launches, robust long-term support, and pre-integrated with several premium streaming apps. Major Estimate Revision • Aug 08
Consensus EPS estimates fall by 11% The consensus outlook for earnings per share (EPS) in fiscal year 2025 has deteriorated. 2025 revenue forecast decreased from NT$57.7b to NT$56.4b. EPS estimate also fell from NT$7.27 per share to NT$6.46 per share. Net income forecast to grow 29% next year vs 32% growth forecast for Communications industry in Taiwan. Consensus price target of NT$118 unchanged from last update. Share price fell 6.8% to NT$103 over the past week. Reported Earnings • Aug 02
Second quarter 2025 earnings released: EPS: NT$1.13 (vs NT$1.85 in 2Q 2024) Second quarter 2025 results: EPS: NT$1.13 (down from NT$1.85 in 2Q 2024). Revenue: NT$12.2b (down 11% from 2Q 2024). Net income: NT$334.3m (down 39% from 2Q 2024). Profit margin: 2.7% (down from 4.0% in 2Q 2024). The decrease in margin was driven by lower revenue. Revenue is forecast to grow 21% p.a. on average during the next 2 years, compared to a 22% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 1% per year whereas the company’s share price has increased by 6% per year. Announcement • May 30
Sercomm Corporation Approves Board Elections Sercomm Corporation at its AGM held on May 29, 2025, approved election of Chao Yue Investment Co. Ltd. Representative: James Wang and Pacific Venture Partners Co. Ltd. Representative: Paul Wang as Directors and Rose Tsou,
Hilo Chen, and Feng Zhu as Independent Directors. Buy Or Sell Opportunity • May 14
Now 21% overvalued Over the last 90 days, the stock has fallen 20% to NT$105. The fair value is estimated to be NT$86.25, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has been flat over the last 3 years. Earnings per share has grown by 12%. Revenue is forecast to grow by 15% in a year. Earnings are forecast to grow by 27% in the next year. Price Target Changed • May 05
Price target decreased by 11% to NT$122 Down from NT$137, the current price target is an average from 5 analysts. New target price is 22% above last closing price of NT$100.00. Stock is down 18% over the past year. The company is forecast to post earnings per share of NT$7.51 for next year compared to NT$7.74 last year. Reported Earnings • May 01
First quarter 2025 earnings: EPS and revenues miss analyst expectations First quarter 2025 results: EPS: NT$1.02 (down from NT$2.35 in 1Q 2024). Revenue: NT$11.4b (down 30% from 1Q 2024). Net income: NT$304.6m (down 55% from 1Q 2024). Profit margin: 2.7% (down from 4.2% in 1Q 2024). The decrease in margin was driven by lower revenue. Revenue missed analyst estimates by 7.1%. Earnings per share (EPS) also missed analyst estimates by 28%. Revenue is forecast to grow 20% p.a. on average during the next 2 years, compared to a 21% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 12% per year whereas the company’s share price has increased by 10% per year. Announcement • Apr 23
Sercomm Corporation to Report Q1, 2025 Results on Apr 30, 2025 Sercomm Corporation announced that they will report Q1, 2025 results on Apr 30, 2025 Valuation Update With 7 Day Price Move • Apr 08
Investor sentiment deteriorates as stock falls 18% After last week's 18% share price decline to NT$94.50, the stock trades at a forward P/E ratio of 10x. Average forward P/E is 14x in the Communications industry in Taiwan. Total returns to shareholders of 37% over the past three years. Upcoming Dividend • Mar 21
Upcoming dividend of NT$4.60 per share Eligible shareholders must have bought the stock before 27 March 2025. Payment date: 30 April 2025. Payout ratio is a comfortable 58% but the company is paying out more than the cash it is generating. Trailing yield: 3.8%. Lower than top quartile of Taiwanese dividend payers (4.6%). Higher than average of industry peers (2.3%). New Risk • Mar 13
New minor risk - Share price stability The company's share price has been volatile over the past 3 months. It is more volatile than 75% of Taiwanese stocks, typically moving 6.1% a week. This is considered a minor risk. Share price volatility indicates the stock is highly sensitive to market conditions or economic conditions rather than being sensitive to its own business performance, which may also be inconsistent. It also increases the risk of potential losses in the short term as the stock tends to have larger drops in price more frequently than other stocks. Currently, the following risks have been identified for the company: Minor Risks Dividend is not well covered by cash flows (106% cash payout ratio). Share price has been volatile over the past 3 months (6.1% average weekly change). Declared Dividend • Mar 06
Dividend reduced to NT$4.60 Dividend of NT$4.60 is 8.0% lower than last year. Ex-date: 27th March 2025 Payment date: 30th April 2025 Dividend yield will be 3.4%, which is higher than the industry average of 2.3%. Sustainability & Growth Dividend is covered by earnings (58% earnings payout ratio) but not covered by cash flows (106% cash payout ratio). The dividend has increased by an average of 5.2% per year over the past 10 years. However, payments have been volatile during that time. EPS is expected to grow by 34% over the next 2 years, which should provide support to the dividend and adequate earnings cover. Announcement • Mar 03
Sercomm Corporation, Annual General Meeting, May 29, 2025 Sercomm Corporation, Annual General Meeting, May 29, 2025, at 09:00 Taipei Standard Time. Location: no,81, you yih rd., jhunan township, miaoli county Taiwan Reported Earnings • Mar 01
Full year 2024 earnings: EPS misses analyst expectations Full year 2024 results: EPS: NT$7.74 (down from NT$9.17 in FY 2023). Revenue: NT$56.8b (down 9.3% from FY 2023). Net income: NT$2.27b (down 4.8% from FY 2023). Profit margin: 4.0% (up from 3.8% in FY 2023). The increase in margin was driven by lower expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 2.7%. Revenue is forecast to grow 12% p.a. on average during the next 2 years, compared to a 25% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 22% per year and the company’s share price has also increased by 22% per year. Announcement • Feb 28
Sercomm Corporation Announces Cash Dividend for the Year Ended December 31, 2024, Payable on April 30, 2025 Sercomm Corporation announced cash dividend of TWD 4.6 per share for the year ended December 31, 2024. Total cash dividend payout is TWD 1,373,327,894. Ex-rights (ex-dividend) trading date is March 27, 2025, Ex-rights (ex-dividend) record date is April 4, 2025 and Payment date of common stock cash dividend distribution is April 30, 2025. Date of the resolution by the board of directors or shareholders meeting or decision by the Company: February 27, 2025. Announcement • Feb 20
Sercomm Corporation to Report Q4, 2024 Results on Feb 27, 2025 Sercomm Corporation announced that they will report Q4, 2024 results on Feb 27, 2025 Announcement • Dec 19
Sercomm Corporation Announces Chief Financial Officer Changes, Effective January 01, 2025 Sercomm Corporation announced that Arthur Hsu (Vice President, Strategic Planning) will replace Alex Liou as Chief Financial Officer. Due to internal job rotation, Vice President Alex Liou and Vice President Arthur Hsu will exchange roles. Effective date: January 01, 2025. The new Chief Financial Officer and Financial Officer will be formally appointed at the upcoming Board of Directors meeting, after which a official announcement will be made. Buy Or Sell Opportunity • Dec 02
Now 21% overvalued after recent price rise Over the last 90 days, the stock has risen 3.2% to NT$115. The fair value is estimated to be NT$94.24, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has grown by 11% over the last 3 years. Earnings per share has grown by 31%. Revenue is forecast to grow by 21% in 2 years. Earnings are forecast to grow by 16% in the next 2 years. Price Target Changed • Nov 26
Price target decreased by 7.1% to NT$132 Down from NT$142, the current price target is an average from 4 analysts. New target price is 18% above last closing price of NT$111. Stock is down 9.8% over the past year. The company is forecast to post earnings per share of NT$7.63 for next year compared to NT$9.17 last year. Reported Earnings • Nov 07
Third quarter 2024 earnings: EPS and revenues miss analyst expectations Third quarter 2024 results: EPS: NT$1.83 (down from NT$2.53 in 3Q 2023). Revenue: NT$13.5b (down 14% from 3Q 2023). Net income: NT$546.1m (down 17% from 3Q 2023). Profit margin: 4.1% (down from 4.2% in 3Q 2023). The decrease in margin was driven by lower revenue. Revenue missed analyst estimates by 6.6%. Earnings per share (EPS) also missed analyst estimates by 10.0%. Revenue is forecast to grow 11% p.a. on average during the next 2 years, compared to a 15% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 31% per year but the company’s share price has only increased by 20% per year, which means it is significantly lagging earnings growth. Announcement • Oct 25
Sercomm Corporation to Report Q3, 2024 Results on Oct 24, 2024 Sercomm Corporation announced that they will report Q3, 2024 results on Oct 24, 2024 New Risk • Aug 15
New major risk - Earnings quality The company has a high level of non-cash earnings. Accrual ratio: 24% This is considered a major risk. Non-cash earnings can arise from many different things. However, if a company consistently has a high level of non-cash earnings, it may be a sign that they are recognizing revenue from customers before the full value of the sales are received as cash or they are not depreciating the value of their assets appropriately. These are practices that inflate earnings, while not providing a similar increase to cash flows. Companies in some select industries naturally have a high level of non-cash earnings and it is not a major concern. However, in the worst case scenario it can be an early sign of performance manipulation by management. Currently, the following risks have been identified for the company: Major Risk High level of non-cash earnings (24% accrual ratio). Minor Risks Paying a dividend despite having no free cash flows. Shareholders have been diluted in the past year (14% increase in shares outstanding). Buy Or Sell Opportunity • Aug 07
Now 27% overvalued Over the last 90 days, the stock has fallen 8.3% to NT$106. The fair value is estimated to be NT$83.11, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has grown by 16% over the last 3 years. Earnings per share has grown by 36%. Revenue is forecast to grow by 5.6% in a year. Earnings are forecast to grow by 4.7% in the next year. Reported Earnings • Aug 07
Second quarter 2024 earnings: EPS misses analyst expectations Second quarter 2024 results: EPS: NT$1.84. Revenue: NT$13.7b (down 13% from 2Q 2023). Net income: NT$545.2m (up 3.5% from 2Q 2023). Profit margin: 4.0% (up from 3.4% in 2Q 2023). The increase in margin was driven by lower expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 11%. Revenue is forecast to grow 8.4% p.a. on average during the next 2 years, compared to a 15% growth forecast for the Communications industry in Taiwan. Announcement • Jul 23
Sercomm Corporation to Report Q2, 2024 Results on Jul 30, 2024 Sercomm Corporation announced that they will report Q2, 2024 results on Jul 30, 2024 Buy Or Sell Opportunity • Jul 02
Now 20% overvalued Over the last 90 days, the stock has fallen 9.9% to NT$123. The fair value is estimated to be NT$102, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has grown by 19% over the last 3 years. Earnings per share has grown by 39%. Revenue is forecast to grow by 8.3% in a year. Earnings are forecast to grow by 7.0% in the next year. Buy Or Sell Opportunity • May 22
Now 21% overvalued Over the last 90 days, the stock has fallen 11% to NT$122. The fair value is estimated to be NT$101, however this is not to be taken as a sell recommendation but rather should be used as a guide only. Revenue has grown by 19% over the last 3 years. Earnings per share has grown by 39%. Revenue is forecast to grow by 9.3% in a year. Earnings are forecast to grow by 13% in the next year. Reported Earnings • May 08
First quarter 2024 earnings: EPS misses analyst expectations First quarter 2024 results: EPS: NT$2.35 (up from NT$1.97 in 1Q 2023). Revenue: NT$16.2b (up 3.4% from 1Q 2023). Net income: NT$674.2m (up 33% from 1Q 2023). Profit margin: 4.2% (up from 3.2% in 1Q 2023). The increase in margin was driven by higher revenue. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 4.8%. Revenue is forecast to grow 13% p.a. on average during the next 2 years, compared to a 13% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 39% per year but the company’s share price has only increased by 22% per year, which means it is significantly lagging earnings growth. Buy Or Sell Opportunity • May 03
Now 22% undervalued after recent price drop Over the last 90 days, the stock has fallen 4.3% to NT$122. The fair value is estimated to be NT$155, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 22% over the last 3 years. Earnings per share has grown by 39%. Revenue is forecast to grow by 27% in 2 years. Earnings are forecast to grow by 46% in the next 2 years. Announcement • May 01
Sercomm Corporation to Report Q1, 2024 Results on May 07, 2024 Sercomm Corporation announced that they will report Q1, 2024 results on May 07, 2024 Buy Or Sell Opportunity • Apr 16
Now 20% undervalued The stock has been flat over the last 90 days, currently trading at NT$126. The fair value is estimated to be NT$158, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 22% over the last 3 years. Earnings per share has grown by 39%. Revenue is forecast to grow by 27% in 2 years. Earnings are forecast to grow by 23% in the next 2 years. Buy Or Sell Opportunity • Mar 29
Now 22% undervalued Over the last 90 days, the stock has risen 1.1% to NT$136. The fair value is estimated to be NT$175, however this is not to be taken as a buy recommendation but rather should be used as a guide only. Revenue has grown by 22% over the last 3 years. Earnings per share has grown by 39%. Revenue is forecast to grow by 27% in 2 years. Earnings are forecast to grow by 23% in the next 2 years. Upcoming Dividend • Mar 22
Upcoming dividend of NT$5.00 per share Eligible shareholders must have bought the stock before 29 March 2024. Payment date: 03 May 2024. Payout ratio is a comfortable 55% but the company is paying out more than the cash it is generating. Trailing yield: 3.3%. Lower than top quartile of Taiwanese dividend payers (4.7%). Higher than average of industry peers (2.5%). Reported Earnings • Mar 08
Full year 2023 earnings: EPS exceeds analyst expectations Full year 2023 results: EPS: NT$9.17 (up from NT$7.57 in FY 2022). Revenue: NT$62.6b (down 3.1% from FY 2022). Net income: NT$2.39b (up 24% from FY 2022). Profit margin: 3.8% (up from 3.0% in FY 2022). The increase in margin was driven by lower expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) surpassed analyst estimates by 2.6%. Revenue is forecast to grow 12% p.a. on average during the next 2 years, compared to a 15% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 39% per year but the company’s share price has only increased by 24% per year, which means it is significantly lagging earnings growth. Price Target Changed • Jan 19
Price target increased by 7.1% to NT$156 Up from NT$145, the current price target is an average from 4 analysts. New target price is 22% above last closing price of NT$127. Stock is up 61% over the past year. The company is forecast to post earnings per share of NT$8.89 for next year compared to NT$7.57 last year. Price Target Changed • Jan 08
Price target increased by 7.1% to NT$156 Up from NT$145, the current price target is an average from 4 analysts. New target price is 22% above last closing price of NT$127. Stock is up 59% over the past year. The company is forecast to post earnings per share of NT$8.84 for next year compared to NT$7.57 last year. Reported Earnings • Nov 14
Third quarter 2023 earnings: EPS exceeds analyst expectations while revenues lag behind Third quarter 2023 results: EPS: NT$2.53 (up from NT$2.09 in 3Q 2022). Revenue: NT$15.6b (down 14% from 3Q 2022). Net income: NT$655.8m (up 24% from 3Q 2022). Profit margin: 4.2% (up from 2.9% in 3Q 2022). The increase in margin was driven by lower expenses. Revenue missed analyst estimates by 3.4%. Earnings per share (EPS) exceeded analyst estimates by 23%. Revenue is forecast to grow 9.7% p.a. on average during the next 3 years, compared to a 16% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 37% per year but the company’s share price has only increased by 17% per year, which means it is significantly lagging earnings growth. Announcement • Sep 16
Sercomm Corporation Announces Availability of Stiletto, its New Turnkey Set Top Box Solution for RDK Sercomm Corporation announced the availability of Stiletto, the company's new turnkey Set Top Box solution for RDK. To be unveiled and demonstrated at the RDK Global Summit in Amsterdam, this advanced Ultra HD STB is the first RDK Video Accelerator solution based on the Broadcom BCM72126. The STB supports all premium entertainment applications, pay TV and FAST channels at up to 4K resolution and includes WiFi 6 connectivity for uninterrupted streaming. Additional capabilities include AV1, Dolby audio, HDR 10+, Dolby Vision, Dolby Atmos, voice remotes, cloud gaming, doorbell camera integration, and webcam video chat. Operators may choose different memory sizes depending on their requirements and cost trade offs. Stiletto can also be configured with tuners for broadcast TV. RDK is an open-source software solution that standardizes core functions used in video, broadband, and IoT connected devices. By standardizing these functions, service providers can develop and deploy applications and services, independent of hardware platforms. RDK enables service providers to control their device diagnostics data, business models, and apps to improve the customer experience and drive business results. The RDK community is comprised of more than 600 companies including CPE manufacturers, SoC vendors, software developers, system integrators, and service providers. Globally, the number of RDK devices deployed is now more 100 million, and dozens of service providers across North America, Europe, Latin America, and Asia are in various stages of evaluation, testing, trials, or deployment. RDK software is available at no cost to RDK licensees, and RDK community member companies can contribute software changes and enhancements back to the community. Reported Earnings • Jul 29
Second quarter 2023 earnings: EPS and revenues miss analyst expectations Second quarter 2023 results: EPS: NT$2.05 (up from NT$1.79 in 2Q 2022). Revenue: NT$15.7b (up 3.0% from 2Q 2022). Net income: NT$526.6m (up 16% from 2Q 2022). Profit margin: 3.4% (up from 3.0% in 2Q 2022). The increase in margin was driven by higher revenue. Revenue missed analyst estimates by 10%. Earnings per share (EPS) also missed analyst estimates by 6.5%. Revenue is forecast to grow 5.8% p.a. on average during the next 2 years, compared to a 8.1% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 34% per year but the company’s share price has only increased by 12% per year, which means it is significantly lagging earnings growth. Announcement • Jul 29
Sercomm Corp. Announces Corporate Governance Officer Changes Sercomm Corp. announced appointment of Raymond Ho/Sr. Manager as corporate governance officer in place of Max Cheng/Accounting Officer and Sr. Director of Finance Management Division. Reason for the change is to enhance corporate governance of the Company, a dedicated corporate governance officer was appointed, and the accounting officer was exempted from concurrently serving as the corporate. Effective date is July 28, 2023. Price Target Changed • Jul 27
Price target increased by 8.1% to NT$107 Up from NT$99.00, the current price target is an average from 5 analysts. New target price is approximately in line with last closing price of NT$108. Stock is up 23% over the past year. The company is forecast to post earnings per share of NT$8.56 for next year compared to NT$7.57 last year. Valuation Update With 7 Day Price Move • Jul 03
Investor sentiment improves as stock rises 18% After last week's 18% share price gain to NT$114, the stock trades at a forward P/E ratio of 13x. Average forward P/E is 19x in the Communications industry in Taiwan. Total returns to shareholders of 59% over the past three years. Upcoming Dividend • Apr 06
Upcoming dividend of NT$4.50 per share at 4.7% yield Eligible shareholders must have bought the stock before 13 April 2023. Payment date: 17 May 2023. Payout ratio is a comfortable 59% and this is well supported by cash flows. Trailing yield: 4.7%. Lower than top quartile of Taiwanese dividend payers (5.9%). Higher than average of industry peers (2.9%). Reported Earnings • Mar 14
Full year 2022 earnings: EPS misses analyst expectations Full year 2022 results: EPS: NT$7.57 (up from NT$3.44 in FY 2021). Revenue: NT$64.6b (up 47% from FY 2021). Net income: NT$1.92b (up 123% from FY 2021). Profit margin: 3.0% (up from 2.0% in FY 2021). The increase in margin was driven by higher revenue. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 1.7%. Revenue is forecast to grow 7.6% p.a. on average during the next 2 years, compared to a 14% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 20% per year but the company’s share price has only increased by 14% per year, which means it is significantly lagging earnings growth. Price Target Changed • Nov 25
Price target decreased to NT$94.00 Down from NT$103, the current price target is an average from 5 analysts. New target price is 14% above last closing price of NT$82.70. Stock is up 26% over the past year. The company is forecast to post earnings per share of NT$7.29 for next year compared to NT$3.44 last year. Price Target Changed • Nov 23
Price target decreased to NT$97.20 Down from NT$107, the current price target is an average from 5 analysts. New target price is 22% above last closing price of NT$79.80. Stock is up 19% over the past year. The company is forecast to post earnings per share of NT$7.75 for next year compared to NT$3.44 last year. Reported Earnings • Nov 16
Third quarter 2022 earnings: EPS misses analyst expectations Third quarter 2022 results: EPS: NT$2.09 (up from NT$0.73 in 3Q 2021). Revenue: NT$18.3b (up 65% from 3Q 2021). Net income: NT$527.7m (up 188% from 3Q 2021). Profit margin: 2.9% (up from 1.6% in 3Q 2021). The increase in margin was driven by higher revenue. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 13%. Revenue is forecast to grow 9.0% p.a. on average during the next 3 years, compared to a 11% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 11% per year but the company’s share price has fallen by 1% per year, which means it is significantly lagging earnings. Reported Earnings • Nov 13
Third quarter 2022 earnings: EPS misses analyst expectations Third quarter 2022 results: EPS: NT$2.09 (up from NT$0.73 in 3Q 2021). Revenue: NT$18.3b (up 65% from 3Q 2021). Net income: NT$527.7m (up 188% from 3Q 2021). Profit margin: 2.9% (up from 1.6% in 3Q 2021). The increase in margin was driven by higher revenue. Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 13%. Revenue is forecast to grow 9.0% p.a. on average during the next 3 years, compared to a 12% growth forecast for the Communications industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 11% per year but the company’s share price has remained flat, which means it is significantly lagging earnings. Price Target Changed • Nov 11
Price target decreased to NT$103 Down from NT$114, the current price target is an average from 5 analysts. New target price is 33% above last closing price of NT$77.00. Stock is up 18% over the past year. The company is forecast to post earnings per share of NT$7.75 for next year compared to NT$3.44 last year. Major Estimate Revision • Aug 15
Consensus revenue estimates increase by 13% The consensus outlook for revenues in 2022 has improved. 2022 revenue forecast increased from NT$57.0b to NT$64.7b. EPS estimate increased from NT$6.07 to NT$7.80 per share. Net income forecast to grow 61% next year vs 43% growth forecast for Communications industry in Taiwan. Consensus price target up from NT$96.20 to NT$114. Share price was steady at NT$99.00 over the past week. Price Target Changed • Aug 09
Price target increased to NT$111 Up from NT$96.20, the current price target is an average from 5 analysts. New target price is approximately in line with last closing price of NT$106. Stock is up 65% over the past year. The company is forecast to post earnings per share of NT$6.61 for next year compared to NT$3.44 last year. Reported Earnings • Aug 07
Second quarter 2022 earnings: EPS and revenues exceed analyst expectations Second quarter 2022 results: EPS: NT$1.79 (up from NT$0.66 in 2Q 2021). Revenue: NT$15.2b (up 52% from 2Q 2021). Net income: NT$452.3m (up 174% from 2Q 2021). Profit margin: 3.0% (up from 1.7% in 2Q 2021). The increase in margin was driven by higher revenue. Revenue exceeded analyst estimates by 9.1%. Earnings per share (EPS) also surpassed analyst estimates by 23%. Over the next year, revenue is forecast to grow 24%, compared to a 20% growth forecast for the industry in Taiwan. Over the last 3 years on average, earnings per share has increased by 3% per year whereas the company’s share price has increased by 6% per year. Announcement • Aug 06
Sercomm Corporation Announces Accounting Officer Changes Sercomm Corporation announced change in the Company's accounting officer. Name, title, and resume of the previous position holder: Leo Chen /CFO. Name, title, and resume of the new position holder: Max Cheng /Senior Director of Financial Management Division. Effective date: August 16, 2022. Board Change • Jul 31
High number of new directors Co-founder & Honorary Chairman Paul Wang was the last director to join the board, commencing their role in 2022. Announcement • Jun 10
Sercomm Corporation Announces Board Changes Sercomm Corporation announced board changes. Position: Chairman. Name of the previous position holder: Paul Wang, Legal Representative of Pacific Venture Partners Co. Ltd. Resume of the previous position holder: Chairman of Sercomm Corporation. Name of the new position holder: James Wang, Legal Representative of Zhuo Jian Investment Co. Ltd. Resume of the new position holder: President and CEO of Sercomm Corporation. Effective date of the new appointment is June 8, 2022. Reported Earnings • May 16
First quarter 2022 earnings: EPS and revenues exceed analyst expectations First quarter 2022 results: EPS: NT$1.29 (up from NT$0.56 in 1Q 2021). Revenue: NT$12.7b (up 32% from 1Q 2021). Net income: NT$326.4m (up 134% from 1Q 2021). Profit margin: 2.6% (up from 1.5% in 1Q 2021). The increase in margin was driven by higher revenue. Revenue exceeded analyst estimates by 1.9%. Earnings per share (EPS) also surpassed analyst estimates by 4.6%. Over the next year, revenue is forecast to grow 20%, compared to a 16% growth forecast for the industry in Taiwan. Over the last 3 years on average, earnings per share has fallen by 1% per year but the company’s share price has increased by 7% per year, which means it is well ahead of earnings. Board Change • Apr 27
Less than half of directors are independent No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 2 experienced directors. 5 highly experienced directors. 3 independent directors (4 non-independent directors). Independent Director Rose Tsou was the last independent director to join the board, commencing their role in 2017. The following issues are considered to be risks according to the Simply Wall St Risk Model: Minority of independent directors. Insufficient board refreshment. Upcoming Dividend • Mar 31
Upcoming dividend of NT$2.40 per share Eligible shareholders must have bought the stock before 07 April 2022. Payment date: 05 May 2022. Payout ratio is a comfortable 70% but the company is not cash flow positive. Trailing yield: 3.0%. Lower than top quartile of Taiwanese dividend payers (5.5%). In line with average of industry peers (3.2%). Reported Earnings • Mar 12
Full year 2021 earnings: EPS exceeds analyst expectations Full year 2021 results: EPS: NT$3.44 (down from NT$3.66 in FY 2020). Revenue: NT$43.9b (up 22% from FY 2020). Net income: NT$861.2m (down 5.1% from FY 2020). Profit margin: 2.0% (down from 2.5% in FY 2020). The decrease in margin was driven by higher expenses. Revenue was in line with analyst estimates. Earnings per share (EPS) surpassed analyst estimates by 9.4%. Over the next year, revenue is forecast to grow 25%, compared to a 13% growth forecast for the industry in Taiwan. Over the last 3 years on average, earnings per share has fallen by 1% per year whereas the company’s share price has increased by 4% per year. Major Estimate Revision • Mar 11
Consensus forecasts updated The consensus outlook for 2022 has been updated. 2022 EPS estimate increased from NT$5.57 to NT$6.19. Revenue forecast steady at NT$54.7b. Net income forecast to grow 72% next year vs 28% growth forecast for Communications industry in Taiwan. Consensus price target of NT$85.80 unchanged from last update. Share price rose 2.7% to NT$75.90 over the past week. Price Target Changed • Feb 25
Price target increased to NT$85.80 Up from NT$77.67, the current price target is an average from 5 analysts. New target price is 19% above last closing price of NT$72.30. Stock is down 0.7% over the past year. The company is forecast to post earnings per share of NT$3.02 for next year compared to NT$3.66 last year. Price Target Changed • Jan 13
Price target increased to NT$81.00 Up from NT$75.17, the current price target is an average from 6 analysts. New target price is 17% above last closing price of NT$69.10. Stock is down 8.1% over the past year. The company is forecast to post earnings per share of NT$2.82 for next year compared to NT$3.66 last year. Price Target Changed • Nov 16
Price target increased to NT$75.17 Up from NT$70.17, the current price target is an average from 5 analysts. New target price is 8.6% above last closing price of NT$69.20. Stock is down 9.3% over the past year. The company is forecast to post earnings per share of NT$2.78 for next year compared to NT$3.66 last year. Reported Earnings • Nov 13
Third quarter 2021 earnings released: EPS NT$0.73 (vs NT$1.13 in 3Q 2020) The company reported a soft third quarter result with weaker earnings and profit margins, although revenues improved. Third quarter 2021 results: Revenue: NT$11.1b (up 17% from 3Q 2020). Net income: NT$183.1m (down 34% from 3Q 2020). Profit margin: 1.6% (down from 2.9% in 3Q 2020). The decrease in margin was driven by higher expenses. Over the last 3 years on average, earnings per share has remained flat but the company’s share price has increased by 7% per year, which means it is well ahead of earnings. Major Estimate Revision • Aug 18
Consensus EPS estimates fall to NT$3.79 The consensus outlook for earnings per share (EPS) in 2021 has deteriorated. 2021 revenue forecast decreased from NT$43.5b to NT$42.0b. EPS estimate also fell from NT$4.60 to NT$3.79. Net income forecast to grow 25% next year vs 13% growth forecast for Communications industry in Taiwan. Consensus price target down from NT$77.57 to NT$69.67. Share price was steady at NT$63.60 over the past week. Price Target Changed • Aug 18
Price target decreased to NT$69.67 Down from NT$77.57, the current price target is an average from 5 analysts. New target price is 9.5% above last closing price of NT$63.60. Stock is down 19% over the past year. Reported Earnings • Aug 12
Second quarter 2021 earnings released: EPS NT$0.66 (vs NT$0.97 in 2Q 2020) The company reported a soft second quarter result with weaker earnings and profit margins, although revenues improved. Second quarter 2021 results: Revenue: NT$10.0b (up 8.1% from 2Q 2020). Net income: NT$165.1m (down 32% from 2Q 2020). Profit margin: 1.7% (down from 2.6% in 2Q 2020). The decrease in margin was driven by higher expenses. Over the last 3 years on average, earnings per share has fallen by 1% per year but the company’s share price has increased by 6% per year, which means it is well ahead of earnings. Upcoming Dividend • Jul 09
Upcoming dividend of NT$2.60 per share Eligible shareholders must have bought the stock before 16 July 2021. Payment date: 13 August 2021. Trailing yield: 3.8%. Lower than top quartile of Taiwanese dividend payers (4.9%). Higher than average of industry peers (2.8%). Major Estimate Revision • May 18
Consensus forecasts updated The consensus outlook for 2021 has been updated. 2021 revenue forecast increased from NT$43.6b to NT$44.5b. EPS estimate fell from NT$5.50 to NT$4.76 per share. Net income forecast to grow 37% next year vs 27% growth forecast for Communications industry in Taiwan. Consensus price target down from NT$86.43 to NT$82.86. Share price fell 4.8% to NT$63.50 over the past week. Major Estimate Revision • May 13
Consensus forecasts updated The consensus outlook for 2021 has been updated. 2021 EPS estimate fell from NT$5.50 to NT$4.62 per share. Revenue forecast steady at NT$43.6b. Net income forecast to grow 34% next year vs 24% growth forecast for Communications industry in Taiwan. Consensus price target down from NT$86.43 to NT$84.00. Share price fell 12% to NT$61.60 over the past week. Reported Earnings • May 08
First quarter 2021 earnings released: EPS NT$0.56 (vs NT$0.35 in 1Q 2020) The company reported a strong first quarter result with improved earnings, revenues and profit margins. First quarter 2021 results: Revenue: NT$9.60b (up 41% from 1Q 2020). Net income: NT$139.4m (up 61% from 1Q 2020). Profit margin: 1.5% (up from 1.3% in 1Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has fallen by 4% per year whereas the company’s share price has fallen by 1% per year. Price Target Changed • Mar 31
Price target decreased to NT$86.86 Down from NT$93.50, the current price target is an average from 6 analysts. New target price is 17% above last closing price of NT$74.10. Stock is up 15% over the past year. Reported Earnings • Mar 25
Full year 2020 earnings released: EPS NT$3.66 (vs NT$4.21 in FY 2019) The company reported a soft full year result with weaker earnings and profit margins, although revenues improved. Full year 2020 results: Revenue: NT$36.1b (up 14% from FY 2019). Net income: NT$907.3m (down 12% from FY 2019). Profit margin: 2.5% (down from 3.2% in FY 2019). The decrease in margin was driven by higher expenses. Over the last 3 years on average, earnings per share has fallen by 9% per year but the company’s share price has only fallen by 3% per year, which means it has not declined as severely as earnings.