AEM - Q3 2020

AEM Q3 PERFORMANCE

Let's look at AEM Q3 results. 

For Q3' 2020, revenue increased 93% compare to same quarter last year and it increased 85.7% for 9M 2020 and net profit is double of last year. Impressive result!!!! So, what's segment bring in the most revenue and profit? Let's take a look. 

From the table, we know that ESS brought in the most revenue, 422 millions followed by SLT-I , 5.3 mil and MEMS, 4.9mil. There is a huge demand for ESS and MEMS. 

Outlook

Management increase the revenue target from 500mil to 520mil.

With the SLT+ vision, AEM offer a full suite of application. 

For Q4 2020, will invest 2mil to R&D. 

Financial calculation.

Assumed FY 2020 able to achieve 520mil with profit margin 16%

Net profit = 83mil.

EPS = 0.305 

Total equity = 200 mil (assumed)

ROE = 41

P/E = 3.55 / 0.305 = 11.6

Opinions 

If AEM able to achieved the target 520mil and margin is 16 percent, the ROE will be 41 and P/E at current price is 11.6. For technology stock, P/E 11 consider low. 

Pros - Net Cash company, 5G and automation is the trend. 

Cons - Too rely on one company, Intel contributed the most revenue.