A Look at Amkor Technology's (AMKR) Valuation Following New Advances in Semiconductor Packaging Solutions

Amkor Technology (AMKR) is in the spotlight after recent moves to strengthen its semiconductor packaging, assembly, and testing capabilities across key global hubs. The company is rolling out new design approaches such as flip-chip formats and high-density layouts. This signals continued innovation within the sector.

See our latest analysis for Amkor Technology.

Amkor Technology’s momentum is hard to miss, with the stock climbing sharply. Its share price return over the last 90 days stands at an impressive 52.3%. Over the past year, patient shareholders have pocketed a total return of 37.5%, underlining steadily building optimism as the company pushes deeper into next-generation chip packaging and global expansion. While recent news about new design offerings has captured attention, this year’s strong rally hints at renewed confidence in Amkor’s long-term positioning and innovation-driven growth story.

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With shares reaching new highs, along with impressive revenue and income growth on display, investors are left to wonder if Amkor Technology is currently undervalued or if the market has already priced in all the future upside.

Price-to-Earnings of 29.2x: Is it justified?

At a last close price of $36.39, Amkor Technology currently trades at a price-to-earnings (P/E) ratio of 29.2x. This positions the company as a relatively cheaper option compared to both its direct peers and the broader semiconductor sector.

The price-to-earnings ratio reflects the market’s expectations for a company’s future earnings growth and overall profitability. A lower P/E compared to industry averages can suggest that the stock is undervalued relative to its profit potential, or it may reflect market skepticism about future growth sustainability.

With Amkor’s P/E below the US semiconductor industry average (36.1x) and below its peer group (39x), the stock looks attractively priced to earnings power on a relative basis. Additionally, the estimated fair P/E ratio of 35.2x indicates the market could gradually re-rate the stock upward if future growth matches expectations.

Explore the SWS fair ratio for Amkor Technology

Result: Price-to-Earnings of 29.2x (UNDERVALUED)

However, slowing revenue growth or industry-wide shifts in semiconductor demand could challenge Amkor Technology’s bullish outlook in the quarters ahead.

Find out about the key risks to this Amkor Technology narrative.

Another Perspective: DCF Model Suggests a Premium

While Amkor Technology’s current price-to-earnings ratio hints at undervaluation, our DCF model offers a different perspective. According to its discounted cash flow analysis, Amkor trades well above its calculated fair value. This suggests the market may be pricing in more growth than the fundamentals support. Should investors prioritize the company’s momentum or carefully consider this cautionary signal?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Amkor Technology for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 914 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Amkor Technology Narrative

If you find yourself questioning this perspective or prefer a hands-on approach, dive into the data and craft your own view of Amkor Technology. It's quick and easy. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Amkor Technology.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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