Aerospace Industrial Development Corp

The company's capital structure is characterized by a debt-to-equity ratio of 1.11, indicating a moderate reliance on debt financing. Its liquidity position is mixed, with a current ratio of 1.39 and negative net cash after subtracting total debt, suggesting potential short-term liquidity constraints. The price-to-book ratio of 2.51 and price-to-tangible-book ratio of 2.51 imply that the market values the company at a premium to its book value, but this is not uncommon in capital-intensive industries like aerospace.

Profitability metrics show a return on equity (ROE) of 3.31% and a return on assets (ROA) of 1.19%, both of which are below the typical performance benchmarks for the aerospace and defense industry. The company's operating margin is 6.80% (calculated from operating income of 598.83 million TWD on revenue of 8.80 billion TWD), which is relatively low compared to industry peers. This suggests that the company may be facing cost pressures or pricing constraints in its core operations.

The company's revenue is concentrated in a single business segment, with no disclosed geographic diversification. This lack of diversification increases exposure to regional economic and political risks, particularly in the context of its primary market in Taiwan. The absence of segment or geographic breakdown in the financial data limits the ability to assess the company's exposure to different markets or product lines.

Looking ahead, the company's revenue is projected to grow by 5.0% in the current fiscal year and 4.5% in the next fiscal year, based on analyst estimates. However, the operating cash flow remains negative at -4.57 billion TWD, which could constrain the company's ability to fund operations and capital expenditures without external financing. The free cash flow of 763.06 million TWD provides some flexibility, but it is not sufficient to cover the capital expenditure of 420.76 million TWD.

The risk assessment highlights a medium liquidity risk and a low dilution risk. The company's negative net cash position after subtracting total debt is a key flag, indicating potential challenges in maintaining liquidity. The dilution risk is low, as there is no indication of significant share issuance or convertible debt outstanding. The company's capital structure and financial flexibility will be critical in managing its growth and operational needs.

Recent events include the release of the latest financial data, which shows a decline in operating cash flow and a moderate increase in revenue. Analysts have provided a mean price target of 56.00 TWD, with a median of 55.50 TWD, suggesting a positive outlook despite the company's current financial challenges. The mean recommendation of 2.50 (on a scale of 1 to 5) indicates a cautious buy stance, with four analysts recommending a hold.

Analysts project 22% upside to a mean price target of 56.0, reflecting a consensus buy recommendation.

Net margin of 6.5% exceeds the aerospace cohort median of 4.4%, indicating superior profitability relative to peers.

Revenue CAGR of 10.6% over four years suggests historical growth momentum despite recent quarterly declines.

Capex to revenue ratio is above the cohort median, suggesting potentially lower capital intensity than peers.

Debt-to-equity ratio of 1.11 places the company in the bottom quartile, indicating excessive leverage risk.

High credit risk flags and bottom-quartile cash conversion metrics suggest significant financial stability challenges.

Revenue TWD 7.59B, +0,6% YoY; Operating income +37,4% YoY.

• ▍Revenue TWD 7.59B, +0,6% YoY
• ▍Operating income +37,4% YoY
• ▍Net income +9,3% YoY
• ▍Free cash flow +42,6% YoY
• ▍Net margin 3.4%

Revenue TWD 10.96B, −3,2% YoY; Operating income +22,2% YoY.

• ▍Revenue TWD 10.96B, −3,2% YoY
• ▍Operating income +22,2% YoY
• ▍Net income −4,0% YoY
• ▍Free cash flow +97,7% YoY
• ▍Net margin 4.8%

Revenue TWD 8.81B, +2,0% YoY; Operating income −61,4% YoY.

• ▍Revenue TWD 8.81B, +2,0% YoY
• ▍Operating income −61,4% YoY
• ▍Net income −21,3% YoY
• ▍Free cash flow +249,6% YoY
• ▍Net margin 2.2%

Revenue TWD 8.14B, −7,5% YoY; Operating income −48,2% YoY.

• ▍Revenue TWD 8.14B, −7,5% YoY
• ▍Operating income −48,2% YoY
• ▍Net income −139,3% YoY
• ▍Free cash flow −123,3% YoY
• ▍Net margin -2.8%

Revenue TWD 7.54B; Operating income TWD 198.3M.

• ▍Revenue TWD 7.54B
• ▍Operating income TWD 198.3M
• ▍Net margin 3.2%

Revenue TWD 11.32B; Operating income TWD 399.0M.

• ▍Revenue TWD 11.32B
• ▍Operating income TWD 399.0M
• ▍Net margin 4.8%

Revenue TWD 8.64B; Operating income TWD 428.9M.

• ▍Revenue TWD 8.64B
• ▍Operating income TWD 428.9M
• ▍Net margin 2.8%

Revenue TWD 8.80B; Operating income TWD 598.8M.

• ▍Revenue TWD 8.80B
• ▍Operating income TWD 598.8M
• ▍Net margin 6.5%

Revenue TWD 35.45B, −9,9% YoY; Operating income −47,1% YoY.

• ▍Revenue TWD 35.45B, −9,9% YoY
• ▍Operating income −47,1% YoY
• ▍Net income −66,2% YoY
• ▍Free cash flow −127,0% YoY
• ▍Net margin 2.1%

Revenue TWD 39.34B, +0,6% YoY; Operating income −16,9% YoY.

• ▍Revenue TWD 39.34B, +0,6% YoY
• ▍Operating income −16,9% YoY
• ▍Net income −2,6% YoY
• ▍Free cash flow −48,2% YoY
• ▍Net margin 5.5%

Revenue TWD 39.10B, +29,3% YoY; Operating income +79,9% YoY.

• ▍Revenue TWD 39.10B, +29,3% YoY
• ▍Operating income +79,9% YoY
• ▍Net income +36,8% YoY
• ▍Free cash flow −33,9% YoY
• ▍Net margin 5.7%

Revenue TWD 30.24B, +27,4% YoY; Operating income +81,0% YoY.

• ▍Revenue TWD 30.24B, +27,4% YoY
• ▍Operating income +81,0% YoY
• ▍Net income +191,6% YoY
• ▍Free cash flow +367,0% YoY
• ▍Net margin 5.4%