AEM Q3' 2021 (Price - SGD4.78) (Calculate IV = 6.21)

 Target:

AEM target - 2020 - 520Mil

Acquire CEI on 2020 - Revenue - 140mil 

AEM target 2021 - Increase from 525mil to 550mil. 

Financial

From the table, we can see that revenue and profit increase every quarter. If AEM want to achieve 550mil, they need to get 212mil revenue in Q4. Looking back at 2020 result, they've set 520mil target revenue and they had achieved 518mil. That mean that management is setting a reasonable and achievable target. 

With the worldwide material shortage, AEM may have buy more to keep stock and causing inventories increase significantly. Cash has increased 51 percents . 

Business outlook

AEM mentioned that Q4 and 2022 demand will increase and they are working with top 20 semiconductor company on technical. 

My thought

I think the 550mil target revenue is abit low, AEM has acquired CEI and their revenue is 140mil. Meaning that AEM only contribute 410mil for this year? Lower than last year about 110 mil. 

Let's do a quick math: 

Price - 4.78

Assume Revenue - 550mil , Earning - 15.5% of 550mil = 85.25mil 

Assume Earning per share - 0.27

SHE- 308,792,506

P/E = 4.78 / 0.27 = 17.7

ROE = 85.25 / 368.792 = 23%

If P/E = 23 , price = SGD 6.21