NEW YORK (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, expanding profit margins and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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Highlights from the ratings report include:
- UMC's revenue growth has slightly outpaced the industry average of 1.6%. Since the same quarter one year prior, revenues slightly increased by 4.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- UMC's debt-to-equity ratio is very low at 0.25 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, UMC has a quick ratio of 2.02, which demonstrates the ability of the company to cover short-term liquidity needs.
- The gross profit margin for UNITED MICROELECTRONICS CORP is rather high; currently it is at 50.20%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.73% is above that of the industry average.
- Net operating cash flow has slightly increased to $330.63 million or 5.15% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -14.07%.
United Microelectronics Corporation provides semiconductor wafer foundry solutions. The company offers wafer manufacturing services and other solutions to address the needs of foundry customers. The company has a P/E ratio of 30.9, above the S&P 500 P/E ratio of 17.7. United Microelectronics has a market cap of $6.06 billion and is part of the technology sector and electronics industry. Shares are up 17.1% year to date as of the close of trading on Monday.
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