Investment Thesis
Amkor exhibits concerning fundamental weakness despite stable growth: negative free cash flow (-79.5M), anemic profitability margins (14.2% gross, 4.9% net), and extremely poor returns on capital (1.8% ROE, 1.0% ROA) indicate the business model generates insufficient returns on invested capital. Flat net income growth despite 6.2% revenue growth signals margin compression in a capital-intensive industry requiring 224.6M annual capex.
Strengths
- Positive operating cash flow of 145.1M demonstrates core business viability
- Conservative leverage with 0.28x debt-to-equity and 6.1x interest coverage provides financial stability
- Strong liquidity position with 2.01x current ratio and 1.1B cash balance
Risks
- Negative free cash flow unsustainable; capex (224.6M) significantly exceeds operating cash flow (145.1M) at only 6.2% growth rate
- Profitability margins critically thin; gross margin of 14.2% and net margin of 4.9% leave no buffer for industry cycles or competition
- Return on capital destruction; 1.8% ROE and 1.0% ROA fail to justify capital deployed in the business
Key Metrics to Watch
- Free cash flow trend and path to positive FCF generation
- Gross margin sustainability and ability to improve pricing power
- Return on equity trajectory and capital efficiency metrics
Financial Metrics
Revenue
1.7B
Net Income
83.4M
EPS (Diluted)
$0.33
Free Cash Flow
-79.5M
Total Assets
8.3B
Cash
1.1B
Profitability Ratios
Gross Margin
14.2%
Operating Margin
6.0%
Net Margin
4.9%
ROE
1.8%
ROA
1.0%
FCF Margin
-4.7%
Balance Sheet & Liquidity
Current Ratio
2.01x
Quick Ratio
1.74x
Debt/Equity
0.28x
Debt/Assets
44.9%
Interest Coverage
6.10x
Long-term Debt
1.3B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-04-29T15:39:21.185362 |
Data as of: 2026-03-31 |
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