Stock Analysis : AEM Holdings

Introduction :

AEM Holdings provides handling and test solutions to the most advanced manufacturers in the world. They deliver many products in the 5G economy including microprocessors, high speed communications, IOT devices, and solar cells.

Financials :

From the images below, you can easily see that despite the semiconductor industry doing badly for the past few years, AEM has managed to increase Revenue as well as Profits year on year (yoy), which is remarkable. You can also see that Free Cash Flow (FCF) has increase year quarter on quarter (qoq). Currently they are in a net cash position, which is always great to see in a company.

Taken from AEM Holdings’ 3Q2019 Results Briefing Presentation

Ratios :

Current Ratio : 2.5597
Quick Ratio : 1.831
Yield : ~2.098% ( Assuming same payout of $0.039 @ 1.86/share )
Dividend Payout : ~ 26.09% (From stockscafe)
NAV/Share : $0.428/share

Personal Thoughts and Positions :

I like AEM Holdings since they are very exposed in the semiconductor industry, and also because one of their key customers is Intel, who is very huge as you might know. They make your CPU chips which are widely used in almost every single computer or laptop you can find in the market.

Looking at this stock in a FA’s pov, I’ll definitely make a buy call but from a TA’s pov, I will need to closely evaluate at what price should I enter. From what I see, the 1.82 range should be a strong enough resistance for me to enter. Of course I will continue to monitor if there is a strong sell down and potential to acquire this stock at a lower price.

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