SUMCO Corp
3436: XTKS (JPN)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
JPY 5,814.00 | Cwmpb | Sjrybkpj |
Sumco Earnings: Short-Term Balance Sheet Pressure Justified by More Customers in Japan
We keep our Sumco fair value estimate at JPY 1,940, despite the disappointing outlook for the first half of 2024, as the firm echoes chipmakers’ comments as to a second-half recovery, and there is higher visibility on new foundries in Japan. Sumco is overvalued, in our opinion, as we believe the market discounted solvency risks following Sumco’s higher debt levels to fund its countercyclical expansion drive.