Amkor Technology's Q3 Earnings Pack Sales Growth But Margins Compress

Grassroots Trading
1.73K Followers
(12min)

Summary

  • Amkor Technology's Q3 revenue beat expectations, but EPS missed by a penny, leading to a 12% stock drop due to rising costs and shrinking margins.
  • Despite strong growth in advanced packaging tech and sectors like 5G and AR, profit margins and net income have faced pressure, impacting overall profitability.
  • Amkor's valuation appears stretched with a blended P/E of 19.48x versus a fair value closer to 15.00x, suggesting the stock is trading at a premium.
  • Given the mixed financials and potential demand dips, I recommend holding Amkor Technology stock until consistent growth and profitability are more evident.
Computer chip shortage

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Thesis

Amkor Technology (NASDAQ:AMKR), which specializes in advanced semiconductor packaging, has been doing pretty well overall, especially with growth in its tech solutions. But when we dig into its recent financial results, things are a bit mixed: for Q3, their earnings

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I focus on producing objective, data-driven research, mostly about small- to mid-cap companies, as these tend to be overlooked by many investors. From time to time, though, I also look at large-cap names, just to give a fuller sense of the broader equity markets.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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