PDF 原檔：報告_Daiwa_研華2395_20261104_original.pdf
圖片清單（已驗證 2026-11-07）
本份抽出 3 張 attachment；001（股價表現）、002（1 年遠期 PER）小於 40KB，未逐張驗證、不嵌。
| 檔名 | size | 分類 | 親眼所見內容 |
|---|---|---|---|
報告_Daiwa_研華2395_20261104_003.png |
41KB | 真資料圖（訂單類，財務類不嵌） | 研華 B/B ratio 圖（1Q20–3Q26）：長條為 Booking 與 Shipment（USDm，左軸），折線為 BB ratio（右軸）；近期標示 1Q26 1.77、2Q26 1.44、3Q26 1.64，3Q26 Booking 約 1,650 百萬美元、Shipment 約 1,000 百萬美元；2025 年各季 BB 約 1.0–1.1，3Q25 1.01，4Q25 1.33 |
原始內容
Advantech (2395 TT)
Target price: TWD750.00 (from TWD700.00)
Shareprice(4Nov):TWD629.00 | Up/downside:+19.2%
3Q26 results: positive tone towards 2027
- Up-cycle will last into 2027, with limited early pull-in shipments in 2026
- Key growth drivers in 2026 include ASP hike and fast Edge AI growth
- Reaffirming our Outperform (2) rating; raising 12-month TP to TWD750
What's new: We update our view on Advantech after 3Q26 results (released on 4 November).
What's the impact: 3Q26 results beat. Advantech's 3Q26 earnings of TWD6.2bn (EPS: TWD7.15) beat our estimate and BBG consensus by 26% and 28%, respectively, driven by record-high OPM (20.9%) and betterthan-expected non-ops (gains from its Japan plant's asset disposal). However, GM fell 1pp QoQ to 36.7%, mainly due to raw-material cost inflation. Management said CPU, memory and other component costs rose to 70% (vs. 30% previously). Although the company could pass on higher costs, it couldn't maintain its blended GM on an incremental sales.
Business update. Looking ahead, Advantech remains positive on its 4Q26 and 2027 outlook, supported by a c.USD2.5bn order backlog and a 3Q26 B/B ratio of 1.64 (vs. 1.6 in October). Management said cost-inflation-driven demand pull-ins were limited in 9M26, but order visibility has extended as clients seek greater allocations. Advantech sees AI infrastructure, semiconductors, factory automation and medical equipment as key growth drivers, with shipments in these applications expected to grow c.15% YoY in 2026E and into 2027E, based on our forecasts. Edge AI remains its fastest-growing application: its revenue contribution rose to 24.5% in 9M26, with c.109% YoY growth, vs. 22.5% in 1H26 and the company's c.30% target for 2026. Growth has been driven mainly by higher ASPs, but we expect unit growth to become the primary driver in 2027E as ASPs lap the increase in 2026 already. In the near term, while management guides its revenue would decrease by single-digit % QoQ due to fewer working days over Christmas holiday period in 4Q26, but we believe this is too conservative. We expect 4Q26E revenue to be broadly flat QoQ, as a solid backlog is on hand. We also expect gross margin to remain similar to 3Q26 amid ongoing cost inflation. Management reported ASP increases of 1020% for CPUs and 15-20% for PCBs, while SSD and memory prices have been relatively stable recently. We expect shortages to ease gradually, particularly for memory, but to persist for CPUs and CCLs.
What we recommend: We raise our 2026-28E EPS by 7-22% to reflect Advantech's 3Q26 results. We reaffirm our Outperform (2) call and raise our 12M TP to TWD750 (from TWD700), based on a lower PER of 26x (prior: 30x; slightly higher than the mid-point of its past-3-year range of 2037x), as we are closer to the end of the up-cycle, and applied to our 1-year forward EPS. Key downside risk: slower-than-expected demand recovery.
How we differ: Our 2026-28E EPS are 10-17% above the consensus, likely due to our more bullish outlook on Advantech's revenue.
5
4
3
Sheng Cheng (886) 2 8758 6253
sheng.cheng@daiwacm-cathay.com.tw
Thomas Kim (886) 2 8758 6249 thomas.kim@daiwacm-cathay.com.tw
Forecast revisions (%)
| Year to 31 Dec | 26E | 27E | 28E |
|---|---|---|---|
| Revenue change | 2.9 | 17.4 | 17.5 |
| Net profit change | 7.8 | 22.4 | 22.9 |
| Core EPS (FD) change | 7.4 | 22.0 | 22.4 |
Source: Daiwa forecasts
Share price performance
| 12-month range | 273.50-740.00 |
|---|---|
| Market cap (USDbn) | 16.64 |
| 3m avg daily turnover (USDm) | 65.08 |
| Shares outstanding (m) | 869 |
| Major shareholder | AsusTek Computer Inc. (14.4%) |
Financial summary (TWD)
| Year to 31 Dec | 26E | 27E | 28E |
|---|---|---|---|
| Revenue (m) | 111,304 | 147,931 | 159,395 |
| Operating profit (m) | 21,932 | 29,744 | 32,129 |
| Net profit (m) | 19,369 | 25,021 | 26,939 |
| Core EPS (fully-diluted) | 22.288 | 28.792 | 30.999 |
| EPS change (%) | 82.0 | 29.2 | 7.7 |
| Daiwa vs Cons. EPS (%) | 9.8 | 16.6 | 10.0 |
| PER (x) | 28.2 | 21.8 | 20.3 |
| Dividend yield (%) | 1.8 | 1.9 | 2.1 |
| DPS | 11.2 | 12.0 | 13.0 |
| PBR (x) | 9.8 | 7.7 | 6.2 |
| EV/EBITDA (x) | 23.3 | 17.2 | 15.5 |
| ROE (%) | 34.9 | 39.4 | 33.9 |
Source: FactSet, Daiwa forecasts
Advantech: Daiwa's revenue and earnings forecast revisions
| (TWDm) | 2026E - Previous | 2026E - New | 2026E - Consensus | 2027E - Previous | 2027E - New | 2027E - Consensus | 2028E - Previous | 2028E - New | 2028E - Consensus |
|---|---|---|---|---|---|---|---|---|---|
| Revenue | 108,139 | 111,304 | 105,375 | 125,982 | 147,931 | 126,075 | 135,599 | 159,395 | 139,286 |
| Diff (%) | 2.9% | 5.6% | 17.4% | 17.3% | 17.5% | 14.4% | |||
| Gross margin (%) | 38.0% | 37.5% | 38.0% | 37.7% | 37.8% | 38.5% | 38.8% | 38.4% | 38.6% |
| Operating profit | 21,047 | 21,932 | 20,269 | 24,662 | 29,744 | 25,248 | 26,516 | 32,129 | 29,213 |
| Operating margin (%) | 19.5% | 19.7% | 19.2% | 19.6% | 20.1% | 20.0% | 19.6% | 20.2% | 21.0% |
| Net profit | 17,969 | 19,369 | 17,642 | 20,441 | 25,021 | 21,458 | 21,925 | 26,939 | 24,489 |
| EPS (TWD) | 20.75 | 22.29 | 20.30 | 23.61 | 28.79 | 24.69 | 25.32 | 31.00 | 28.18 |
| Diff (%) | 7.4% | 9.8% | 22.0% | 16.6% | 22.4% | 10.0% |
Source: Daiwa forecasts, Bloomberg
Advantech: quarterly and annual P&L statement
| (TWDm) | 2026E - 1Q | 2026E - 2Q | 2026E - 3Q | 2026E - 4QE | 2027E - 1QE | 2027E - 2QE | 2027E - 3QE | 2027E - 4QE | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net revenue | 20,385 | 26,126 | 32,440 | 32,353 | 33,884 | 36,841 | 38,916 | 38,289 | 70,882 | 111,304 | 147,931 | 159,395 |
| COGS | -12,405 | -16,281 | -20,544 | -20,377 | -21,266 | -22,907 | -24,141 | -23,671 | -42,685 | -69,608 | -91,984 | -98,225 |
| Gross profit | 7,980 | 9,845 | 11,896 | 11,975 | 12,619 | 13,934 | 14,775 | 14,619 | 28,198 | 41,696 | 55,947 | 61,170 |
| Operating costs | -4,251 | -4,718 | -5,101 | -5,694 | -6,133 | -6,521 | -6,771 | -6,777 | -16,631 | -19,765 | -26,203 | -29,042 |
| Operating profit | 3,728 | 5,127 | 6,795 | 6,281 | 6,485 | 7,413 | 8,004 | 7,841 | 11,567 | 21,932 | 29,744 | 32,129 |
| Non-operating profit | 340 | 463 | 1,106 | 325 | 340 | 370 | 385 | 362 | 1,123 | 2,233 | 1,456 | 1,470 |
| Pre-tax profit | 4,068 | 5,590 | 7,901 | 6,606 | 6,825 | 7,783 | 8,389 | 8,203 | 12,690 | 24,165 | 31,200 | 33,598 |
| Income taxes | -750 | -1,087 | -1,700 | -1,321 | -1,365 | -1,557 | -1,678 | -1,641 | -2,097 | -4,796 | -6,179 | -6,659 |
| Net profit | 3,334 | 4,518 | 6,218 | 5,299 | 5,476 | 6,242 | 6,726 | 6,578 | 10,593 | 19,369 | 25,021 | 26,939 |
| EPS (TWD) | 3.85 | 5.20 | 7.15 | 6.10 | 6.30 | 7.18 | 7.74 | 7.57 | 12.24 | 22.29 | 28.79 | 31.00 |
| Operating Ratios | ||||||||||||
| Gross margin | 39.1% | 37.7% | 36.7% | 37.0% | 37.2% | 37.8% | 38.0% | 38.2% | 39.8% | 37.5% | 37.8% | 38.4% |
| Operating margin | 18.3% | 19.6% | 20.9% | 19.4% | 19.1% | 20.1% | 20.6% | 20.5% | 16.3% | 19.7% | 20.1% | 20.2% |
| Pre-tax margin | 20.0% | 21.4% | 24.4% | 20.4% | 20.1% | 21.1% | 21.6% | 21.4% | 17.9% | 21.7% | 21.1% | 21.1% |
| Net margin | 16.4% | 17.3% | 19.2% | 16.4% | 16.2% | 16.9% | 17.3% | 17.2% | 14.9% | 17.4% | 16.9% | 16.9% |
| YoY (%) | ||||||||||||
| Net revenue | 17% | 46% | 83% | 81% | 66% | 41% | 20% | 18% | 19% | 57% | 33% | 8% |
| Gross profit | 14% | 38% | 72% | 68% | 58% | 42% | 24% | 22% | 16% | 48% | 34% | 9% |
| Operating profit | 28% | 64% | 151% | 123% | 74% | 45% | 18% | 25% | 28% | 90% | 36% | 8% |
| Pre-tax profit | 26% | 124% | 141% | 79% | 68% | 39% | 6% | 24% | 16% | 90% | 29% | 8% |
| Net profit | 22% | 127% | 125% | 71% | 64% | 38% | 8% | 24% | 18% | 83% | 29% | 8% |
| QoQ (%) | ||||||||||||
| Net revenue | 14% | 28% | 24% | 0% | 5% | 9% | 6% | -2% | ||||
| Gross profit | 12% | 23% | 21% | 1% | 5% | 10% | 6% | -1% | ||||
| Operating profit | 33% | 38% | 33% | -8% | 3% | 14% | 8% | -2% | ||||
| Pre-tax profit | 11% | 37% | 41% | -16% | 3% | 14% | 8% | -2% | ||||
| Net profit | 7% | 36% | 38% | -15% | 3% | 14% | 8% | -2% |
Source: Company, Daiwa forecasts
Advantech: 3Q26 results highlights
| (TWDm) | Actual | QoQ% | YoY% | Daiwa | Diff % | Consensus | Diff % |
|---|---|---|---|---|---|---|---|
| Revenues | 32,440 | 24% | 83% | 30,130 | 8% | 28,945 | 12% |
| Gross profit | 11,896 | 21% | 72% | 11,333 | 5% | 10,877 | 9% |
| Gross margin (%) | 36.7% | 37.6% | 37.6% | ||||
| Operating profit | 6,795 | 33% | 151% | 5,940 | 14% | 5,628 | 21% |
| Operating margin (%) | 20.9% | 19.7% | 19.4% | ||||
| Pre-tax profit | 7,901 | 41% | 141% | 6,165 | 28% | 5,927 | 33% |
| Net profit | 6,218 | 38% | 125% | 4,947 | 26% | 4,842 | 28% |
| EPS (TWD) | 7.15 | 38% | 125% | 5.71 | 26% | 5.59 | 28% |
Source: Company data, Daiwa forecasts, Bloomberg
Advantech: 1-year forward PER
Advantech: B/B ratio
Source: TEJ, Daiwa forecasts
Source: Company
Financial summary
Key assumptions
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Embedded Design-in sales YoY% | 11.6 | 31.1 | (0.7) | (14.2) | 7.3 | 27.7 | 10.5 | 13.2 |
| Industrial IoTsalesYoY% | 16.0 | 2.3 | (17.4) | 4.5 | 27.4 | 35.5 | 10.1 | 4.0 |
| Service IoT sales YoY% | 20.2 | 26.7 | (6.1) | (6.7) | 31.3 | (25.5) | 14.0 | 10.2 |
Profit and loss (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Embedded Design-in | 26,652 | 34,940 | 34,683 | 29,747 | 31,927 | 40,774 | 45,051 | 50,993 |
| Industrial IoT | 19,803 | 20,260 | 16,744 | 17,506 | 22,303 | 30,223 | 33,284 | 34,605 |
| Other Revenue | 12,168 | 13,544 | 13,141 | 12,533 | 16,652 | 40,307 | 69,596 | 73,797 |
| Total Revenue | 58,622 | 68,745 | 64,568 | 59,786 | 70,882 | 111,304 | 147,931 | 159,395 |
| Other income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| COGS | (36,490) | (42,632) | (38,406) | (35,410) | (42,685) | (69,608) | (91,984) | (98,225) |
| SG&A | (8,057) | (8,762) | (9,172) | (9,866) | (10,835) | (12,743) | (17,336) | (18,763) |
| Other op.expenses | (4,270) | (4,768) | (4,830) | (5,416) | (5,795) | (7,021) | (8,866) | (10,279) |
| Operating profit | 9,804 | 12,583 | 12,160 | 9,094 | 11,567 | 21,932 | 29,744 | 32,129 |
| Net-interest inc./(exp.) | 12 | 16 | 230 | 294 | 252 | 218 | 217 | 217 |
| Assoc/forex/extraord./others | 229 | 587 | 377 | 934 | 870 | 2,015 | 1,239 | 1,253 |
| Pre-tax profit | 10,045 | 13,187 | 12,767 | 10,322 | 12,690 | 24,165 | 31,200 | 33,598 |
| Tax | (1,948) | (2,700) | (2,477) | (2,086) | (2,189) | (4,858) | (6,240) | (6,720) |
| Min. int./pref. div./others | (57) | 15 | 48 | 117 | 92 | 61 | 61 | 61 |
| Net profit (reported) | 8,040 | 10,501 | 10,338 | 8,352 | 10,593 | 19,369 | 25,021 | 26,939 |
| Net profit (adjusted) | 8,040 | 10,501 | 10,338 | 8,352 | 10,593 | 19,369 | 25,021 | 26,939 |
| EPS (reported)(TWD) | 10.390 | 13.500 | 12.052 | 9.673 | 12.243 | 22.288 | 28.792 | 30.999 |
| EPS (adjusted)(TWD) | 10.390 | 13.500 | 12.052 | 9.673 | 12.243 | 22.288 | 28.792 | 30.999 |
| EPS (adjusted fully-diluted)(TWD) | 10.390 | 13.500 | 12.052 | 9.673 | 12.243 | 22.288 | 28.792 | 30.999 |
| DPS (TWD) | 7.127 | 8.071 | 10.080 | 9.449 | 8.405 | 11.200 | 12.000 | 13.000 |
| EBIT | 9,804 | 12,583 | 12,160 | 9,094 | 11,567 | 21,932 | 29,744 | 32,129 |
| EBITDA | 10,901 | 13,640 | 13,247 | 10,188 | 12,777 | 22,977 | 30,920 | 33,478 |
Cash flow (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Profit before tax | 10,045 | 13,187 | 12,767 | 10,322 | 12,690 | 24,165 | 31,200 | 33,598 |
| Depreciation and amortisation | 1,097 | 1,057 | 1,086 | 1,094 | 1,210 | 1,045 | 1,176 | 1,350 |
| Tax paid | (1,948) | (2,700) | (2,477) | (2,086) | (2,189) | (4,858) | (6,240) | (6,720) |
| Change in working capital | (3,061) | (2,727) | 5,006 | (596) | (906) | (7,933) | (7,422) | (2,253) |
| Other operational CF items | 4,541 | 915 | (6,717) | 1,778 | (901) | (95) | (71) | (96) |
| Cash flow from operations | 10,674 | 9,731 | 9,665 | 10,511 | 9,903 | 12,324 | 18,642 | 25,879 |
| Capex | (1,036) | (1,353) | (1,236) | (1,505) | (2,837) | (2,337) | (3,107) | (3,347) |
| Net (acquisitions)/disposals | (354) | (55) | (1,708) | 764 | (1,050) | 0 | 0 | 0 |
| Other investing CF items | (2,908) | (1,703) | 645 | 666 | (342) | 1 | 1 | 1 |
| Cash flow from investing | (4,298) | (3,111) | (2,299) | (75) | (4,228) | (2,336) | (3,106) | (3,346) |
| Change in debt | 91 | 401 | (276) | (111) | (61) | 0 | 0 | 0 |
| Net share issues/(repurchases) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividends paid | (5,506) | (6,236) | (7,800) | (8,158) | (7,259) | (9,690) | (10,429) | (11,298) |
| Other financing CF items | (148) | 187 | 12 | 477 | (526) | 506 | 524 | 545 |
| Cash flow from financing | (5,564) | (5,649) | (8,064) | (7,792) | (7,846) | (9,184) | (9,905) | (10,753) |
| Forex effect/others | (488) | 886 | (46) | 357 | (136) | 0 | 0 | 0 |
| Change in cash | 324 | 1,857 | (744) | 3,000 | (2,308) | 804 | 5,632 | 11,780 |
| Free cash flow | 9,638 | 8,378 | 8,429 | 9,005 | 7,066 | 9,987 | 15,536 | 22,531 |
Source: FactSet, Daiwa forecasts
Financial summary continued …
Balance sheet (TWDm)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Cash & short-term investment | 11,426 | 15,381 | 21,200 | 20,456 | 19,194 | 10,584 | 16,216 | 27,996 |
| Inventory | 12,517 | 14,008 | 9,804 | 10,554 | 11,835 | 18,255 | 24,123 | 25,760 |
| Accounts receivable | 10,346 | 11,190 | 9,345 | 10,203 | 10,614 | 16,345 | 21,723 | 23,407 |
| Other current assets | 832 | 1,168 | 1,037 | 986 | 853 | 853 | 853 | 853 |
| Total current assets | 35,121 | 41,747 | 41,386 | 42,200 | 42,496 | 46,036 | 62,915 | 78,015 |
| Fixed assets | 10,247 | 11,039 | 11,326 | 12,244 | 14,452 | 15,744 | 17,675 | 19,673 |
| Goodwill & intangibles | 2,665 | 2,789 | 2,750 | 2,814 | 2,735 | 2,735 | 2,735 | 2,735 |
| Other non-current assets | 9,795 | 10,809 | 13,594 | 14,484 | 16,036 | 16,314 | 16,657 | 17,009 |
| Total assets | 57,828 | 66,385 | 69,056 | 71,742 | 75,718 | 80,830 | 99,982 | 117,432 |
| Short-term debt | 256 | 531 | 238 | 0 | 0 | 0 | 0 | 0 |
| Accounts payable | 7,487 | 7,126 | 6,089 | 6,911 | 7,681 | 11,898 | 15,723 | 16,789 |
| Other current liabilities | 8,761 | 10,823 | 9,700 | 8,658 | 8,837 | 8,760 | 8,760 | 8,760 |
| Total current liabilities | 16,504 | 18,481 | 16,027 | 15,569 | 16,517 | 20,657 | 24,482 | 25,549 |
| Long-term debt | 0 | 122 | 0 | 156 | 150 | 150 | 150 | 150 |
| Other non-current liabilities | 2,962 | 3,499 | 4,220 | 4,219 | 4,001 | 4,001 | 4,001 | 4,001 |
| Total liabilities | 19,465 | 22,101 | 20,247 | 19,945 | 20,668 | 24,808 | 28,633 | 29,700 |
| Share capital | 7,738 | 7,778 | 8,578 | 8,634 | 8,652 | 8,690 | 8,690 | 8,690 |
| Reserves/R.E./others | 30,114 | 36,036 | 39,883 | 42,794 | 46,296 | 47,229 | 62,557 | 78,940 |
| Shareholders' equity | 37,853 | 43,815 | 48,461 | 51,428 | 54,947 | 55,920 | 71,247 | 87,630 |
| Minority interests | 510 | 469 | 348 | 369 | 102 | 102 | 102 | 102 |
| Total equity & liabilities | 57,828 | 66,385 | 69,056 | 71,742 | 75,718 | 80,830 | 99,982 | 117,432 |
| EV | 535,970 | 532,371 | 526,016 | 526,698 | 527,688 | 536,298 | 530,666 | 518,886 |
| Net debt/(cash) | (11,170) | (14,728) | (20,962) | (20,300) | (19,044) | (10,434) | (16,066) | (27,846) |
| BVPS (TWD) | 48.916 | 56.328 | 56.496 | 59.563 | 63.509 | 64.346 | 81.983 | 100.835 |
Key ratios (%)
| Year to 31 Dec | 2021 | 2022 | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|
| Sales (YoY) | 14.7 | 17.3 | (6.1) | (7.4) | 18.6 | 57.0 | 32.9 | 7.7 |
| EBITDA (YoY) | 9.1 | 25.1 | (2.9) | (23.1) | 25.4 | 79.8 | 34.6 | 8.3 |
| Operating profit (YoY) | 8.6 | 28.3 | (3.4) | (25.2) | 27.2 | 89.6 | 35.6 | 8.0 |
| Net profit (YoY) | 10.3 | 30.6 | (1.6) | (19.2) | 26.8 | 82.9 | 29.2 | 7.7 |
| Core EPS (fully-diluted) (YoY) | 10.0 | 29.9 | (10.7) | (19.7) | 26.6 | 82.0 | 29.2 | 7.7 |
| Gross-profit margin | 37.8 | 38.0 | 40.5 | 40.8 | 39.8 | 37.5 | 37.8 | 38.4 |
| EBITDA margin | 18.6 | 19.8 | 20.5 | 17.0 | 18.0 | 20.6 | 20.9 | 21.0 |
| Operating-profit margin | 16.7 | 18.3 | 18.8 | 15.2 | 16.3 | 19.7 | 20.1 | 20.2 |
| Net profit margin | 13.7 | 15.3 | 16.0 | 14.0 | 14.9 | 17.4 | 16.9 | 16.9 |
| ROAE | 22.3 | 25.7 | 22.4 | 16.7 | 19.9 | 34.9 | 39.4 | 33.9 |
| ROAA | 14.9 | 16.9 | 15.3 | 11.9 | 14.4 | 24.7 | 27.7 | 24.8 |
| ROCE | 26.6 | 30.1 | 25.9 | 18.0 | 21.6 | 39.4 | 46.6 | 40.3 |
| ROIC | 32.1 | 35.3 | 34.1 | 24.5 | 28.4 | 43.0 | 47.2 | 44.6 |
| Net debt to equity | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. |
| Effective tax rate | 19.4 | 20.5 | 19.4 | 20.2 | 17.3 | 20.1 | 20.0 | 20.0 |
| Accounts receivable (days) | 59.7 | 57.2 | 58.0 | 59.7 | 53.6 | 44.2 | 47.0 | 51.7 |
| Current ratio (x) | 2.1 | 2.3 | 2.6 | 2.7 | 2.6 | 2.2 | 2.6 | 3.1 |
| Net interest cover (x) | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. | n.a. |
| Net dividend payout | 75.5 | 77.7 | 74.7 | 78.4 | 86.9 | 91.5 | 53.8 | 45.2 |
| Free cash flow yield | 1.8 | 1.5 | 1.5 | 1.6 | 1.3 | 1.8 | 2.8 | 4.1 |
Source: FactSet, Daiwa forecasts
Company profile
Founded in 1981 and listed in 1999, Advantech is the largest industrial PC (IPC) maker worldwide in terms of embedded board/system sales, followed by the company's main competitors, Germany-based Kontron and US-based Radisys. The company mainly provides embedded computing boards, chassis, industrial computers, applied computers and design-in services. The businesses are categorised into 4 segments: Embedded design-in, Industrial IoT, Service IoT, and Global services.
ESG analysis
ESG risks
| Risks | Management | Analystcomments | |
|---|---|---|---|
| Executive/board quality | 1 of regulations For 2026, Advantech | Advantech's current board consists of nine directors, with three independent directors. To effectively enhance corporate governance, the company's constitution specifies that its number independent directors cannot be less than three. This regulation is even stricter than the set by the government. The backgrounds of its three independent directors are diversified, with expertise in technology, finance, business, management and accounting. We see it as a positive factor for the board's quality. declared a DPS of TWD11.20 to be paid out of the 2025 results, | |
| G | Capital management | 2 | representing a 92% payout ratio. The payout ratio has been quite stable in the past few years and in the range of 70-84%. According to Advantech's dividend policy, management may consider paying out an additional TWD2 stock dividend in the next three years, if the business operation has achieved the company's targets. Indeed, Advantech has executed this policy in 2014, 2017, 2020 and 2023. The IPC market growth has been stable at 5-10% per year recently. This makes Advantech eager to develop its WISW-PaaS 3.0 platform to integrate its hardware business with software. By doing so, the company believes it can lift its profit margins by creating additional value via its total solutions offerings. Besides, Advantech aims to acquire partial stakes in its competitors in order to propel the communication standardisation for the AIoT platform (eg, Wise-PaaS 3.0). We believe these investments will be long-term value-accretive to investors. |
| S | Related party & transaction | 3 In 2010, Advantech system, suppliers substances prohibited Based on the procurement onsite inspections the vendors' manufacturing | Revenue from related parties was 0.2% of total 2025 revenue, while purchases and other operating costs from related parties were 0.6% of total cost of sales. We see limited risk from these related-party transactions given their small contribution and the company's disclosure that transactions were generally conducted under normal pricing and commercial terms. Separately, Advantech has sizable intra-group transactions with its subsidiaries due to its global manufacturing and sales structure. In 2025, ANA remained the parent company's largest disclosed intra-group sales counterparty, while AKMC remained a major manufacturing counterparty. These intra-group transactions are eliminated upon consolidation, and disclosed transaction terms showed no significant difference from those with third parties. We therefore see limited governance risk from related-party transactions based on current disclosures. established its 'green supply management system'. In its management must promise and guarantee that their products will not contain hazardous by Advantech. procedure within the management system, Advantech conducts at high-risk suppliers on its Preferred Vendor List (PVL). Inspection includes processes, quality, environmental safety and health, labour |
| Supplychain management | 1 | conditions, and CSR management. Besides, Advantech strictly incorporates environmental protection principles in its supplier management mechanism. The company has incorporated the Responsible Business Alliance (RBA) management system, demanding that its suppliers promote CSR. To date, Advantech's evaluation index management for all suppliers has included critical CSR indices such as RoHS (HSF), QC080000, ISO14001, OHSAS18001 (ISO 45001), and supplier localisation regulated by the RBA. Overall, we see that Advantech has created a systematic platform to regulate and manage its supply chain to meet ethical and environmental standards. | |
| S | Datasecurity | 2 Based on Advantech's organisation and | information policy, it will establish a dedicated information security appropriate management procedures to ensure confidentiality and integrity, and protect the privacy of users and customer data. The major measures include: 1) an appropriate IT backup mechanism, and 2) third-party informationsecuritycertificationsandregularexternal inspections. Advantech will implement an information security management system in accordance with the requirements of the ISO / IEC 27001: 2013 standards. Both the Linkou and Kunshan plants have acquired the ISO 27001 certification. |
Note: Management score represents a company's ability to manage/benefit from certain ESG topics. The scores range from 1 to 3, with 1 being the strongest.
Update Date: 4 Nov 2026
Source: Daiwa, Company