Yulon Motor Co Ltd

Yulon Motor maintains a capital structure characterized by a high debt-to-equity ratio of 4.16, indicating a significant reliance on debt financing. The company's liquidity position is moderate, with a current ratio of 1.04, suggesting limited short-term liquidity cushion. Free cash flow of TWD 4.31 billion supports operational flexibility, but the negative net cash position after subtracting total debt highlights structural leverage risk.

Profitability metrics reveal a return on equity (ROE) of 1.97% and a return on assets (ROA) of 0.31%, both below the industry median for auto manufacturers. Gross profit of TWD 7.17 billion and operating income of TWD 2.2 billion indicate margin compression relative to peers, with net income of TWD 1.21 billion reflecting a 5.29% net margin.

Geographically, Yulon Motor's revenue is heavily concentrated in Taiwan, with disclosed segments showing no material diversification into international markets. The company's exposure to domestic economic cycles and regulatory shifts in the region remains a key concentration risk.

Revenue growth has been modest, with the current fiscal year (FY) outlook showing no significant acceleration. Analysts project a stable price target of TWD 38.00, with a mean recommendation of "strong buy" based on two strong-buy ratings and no hold or sell ratings.

Risk factors include medium liquidity risk due to the current ratio and negative net cash position, as well as potential dilution from capital structure adjustments. No near-term dilution pressure is currently indicated, with dilution sources limited to potential capital raising for debt servicing or expansion.

Recent filings and transcripts highlight ongoing efforts to optimize production efficiency and manage supply chain disruptions. No material new risks or strategic shifts were disclosed in the latest investor communications.

Operating and net margins exceed the Auto & Truck Manufacturers cohort median, indicating superior profitability relative to peers.

Cash conversion is best-in-class at 8.15, significantly outperforming the cohort median of 0.62.

Analysts assign a strong buy rating with a mean price target of 38.0, implying 42.6% upside.

Free cash flow remains positive at 7.7 billion TWD in FY2026, supporting ongoing operational liquidity.

Debt-to-equity ratio stands at 4.16, placing the company in the bottom quartile of its cohort.

The company faces high credit risk, posing significant financial stability concerns for investors.

Return on equity of 1.97% falls below the cohort median of 3.96%, indicating inefficient capital utilization.

Revenue TWD 16.98B, −3,5% YoY; Operating income +20,4% YoY.

• ▍Revenue TWD 16.98B, −3,5% YoY
• ▍Operating income +20,4% YoY
• ▍Net income −16,5% YoY
• ▍Free cash flow +34,8% YoY
• ▍Net margin 2.1%

Revenue TWD 18.52B, −10,8% YoY; Operating income +10,2% YoY.

• ▍Revenue TWD 18.52B, −10,8% YoY
• ▍Operating income +10,2% YoY
• ▍Net income −71,4% YoY
• ▍Free cash flow +11,1% YoY
• ▍Net margin 0.9%

Revenue TWD 18.27B, −14,5% YoY; Operating income −34,4% YoY.

• ▍Revenue TWD 18.27B, −14,5% YoY
• ▍Operating income −34,4% YoY
• ▍Net income −79,9% YoY
• ▍Free cash flow −34,9% YoY
• ▍Net margin 1.4%

Revenue TWD 17.97B, −21,8% YoY; Operating income −30,3% YoY.

• ▍Revenue TWD 17.97B, −21,8% YoY
• ▍Operating income −30,3% YoY
• ▍Net income −90,5% YoY
• ▍Free cash flow −28,2% YoY
• ▍Net margin 0.6%

Revenue TWD 17.59B; Operating income TWD 1.50B.

• ▍Revenue TWD 17.59B
• ▍Operating income TWD 1.50B
• ▍Net margin 2.5%

Revenue TWD 20.76B; Operating income TWD 1.25B.

• ▍Revenue TWD 20.76B
• ▍Operating income TWD 1.25B
• ▍Net margin 2.9%

Revenue TWD 21.37B; Operating income TWD 1.90B.

• ▍Revenue TWD 21.37B
• ▍Operating income TWD 1.90B
• ▍Net margin 6.0%

Revenue TWD 22.98B; Operating income TWD 2.20B.

• ▍Revenue TWD 22.98B
• ▍Operating income TWD 2.20B
• ▍Net margin 5.3%

Revenue TWD 72.36B, −15,7% YoY; Operating income −22,1% YoY.

• ▍Revenue TWD 72.36B, −15,7% YoY
• ▍Operating income −22,1% YoY
• ▍Net income −75,2% YoY
• ▍Free cash flow −21,7% YoY
• ▍Net margin 1.4%

Revenue TWD 85.78B, +4,5% YoY; Operating income −16,6% YoY.

• ▍Revenue TWD 85.78B, +4,5% YoY
• ▍Operating income −16,6% YoY
• ▍Net income −15,7% YoY
• ▍Free cash flow −17,3% YoY
• ▍Net margin 4.6%

Revenue TWD 82.12B, +6,5% YoY; Operating income −6,0% YoY.

• ▍Revenue TWD 82.12B, +6,5% YoY
• ▍Operating income −6,0% YoY
• ▍Net income +199,9% YoY
• ▍Free cash flow +415,3% YoY
• ▍Net margin 5.7%

Revenue TWD 77.08B, −1,2% YoY; Operating income +30,9% YoY.

• ▍Revenue TWD 77.08B, −1,2% YoY
• ▍Operating income +30,9% YoY
• ▍Net income −199,6% YoY
• ▍Free cash flow −79,1% YoY
• ▍Net margin -6.1%