Fact based stock research
Advantech (TSEC:2395)

TW0002395001

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Advantech stock research in summary

advantech.com

ANALYSIS: With an Obermatt Combined Rank of 13 (worse than 87% compared with investment alternatives), Advantech (Technology Hardware & Peripherals, Taiwan) shares have lower financial characteristics compared with similar stocks. Shares of Advantech are low in value (priced high) with a consolidated Value Rank of 5 (worse than 95% of alternatives) and show below-average growth (Growth Rank of 17) but are safely financed (Safety Rank of 63), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 13, is a sell recommendation based on Advantech's financial characteristics. As the company Advantech's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 5) and low growth (Obermatt Growth Rank of 17), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 63) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	5
Growth Rank	17
Safety Rank	63
Combined Rank	13

Country	Taiwan
Industry	Technology Hardware & Peripherals
Index	FTSE Taiwan
Size class	Large

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Advantech

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	39	5	7	5
GROWTH
GROWTH	37	33	9	17
SAFETY
SAFETY	76	68	65	63
SENTIMENT
SENTIMENT	n/a	63	41	^new
360° VIEW
360° VIEW	n/a	29	12	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Advantech is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	39	5	7	5
GROWTH
GROWTH	37	33	9	17
SAFETY
SAFETY	76	68	65	63
COMBINED
COMBINED	38	18	7	13

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Advantech the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 5 (worse than 95% compared with alternatives), Advantech shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Advantech. Price-to-Sales is 7 which means that the stock price compared with what market professionals expect for future profits is higher than 93% of comparable companies, indicating a low value concerning Advantech's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 11, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Advantech. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 5 and Dividend Yield, which is lower than 69% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 5, is a sell recommendation based on Advantech's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Advantech? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Advantech? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Advantech may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	13	9	14	7
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	53	5	10	5
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	8	1	5	11
DIVIDEND YIELD
DIVIDEND YIELD	88	21	32	31
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	39	5	7	5

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Advantech; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 17 (better than 17% compared with alternatives), Advantech shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below-average for Advantech. While Sales Growth ranks at 55, professionals currently expect the company to grow more than 55% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 16, which means that, currently, professionals expect the company to grow its profits less than 84% of its competitors, and Capital Growth has a low rank of 37. Historic stock returns were also below average with a current Stock Returns rank of 39 which means that the stock returns have recently been below 61% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 17, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance isn't stellar here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	30	64	27	55
PROFIT GROWTH
PROFIT GROWTH	92	24	58	16
CAPITAL GROWTH
CAPITAL GROWTH	n/a	43	22	37
STOCK RETURNS
STOCK RETURNS	58	41	31	39
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	37	33	9	17

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Advantech.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Advantech has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Advantech is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Advantech. Leverage is at a rank of 78, meaning the company has a below-average debt-to-equity ratio. It has less debt than 78% of its competitors. Liquidity is also good at a rank of 93, meaning the company generates more profit to service its debt than 93% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 7, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 93% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% compared with alternatives), Advantech has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Advantech. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Advantech and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	47	92	84	78
REFINANCING
REFINANCING	45	3	5	7
LIQUIDITY
LIQUIDITY	97	90	93	93
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	76	68	65	63

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Advantech and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	37	29	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	69	44	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	30	74	^new
MARKET PULSE
MARKET PULSE	n/a	100	49	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	63	41	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Advantech.
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