PDF 原檔：報告_美銀_研華2395_20260717_original.pdf
圖片清單（已驗證 2026-07-20）
| 檔名 | size | 分類 | 親眼所見內容 |
|---|---|---|---|
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87KB | 真資料圖 | B/B ratio 歷史圖：Booking／Shipment（US$mn，柱狀）+ B/B ratio 折線，1Q20–1Q26，1Q26 B/B=1.77 為近年高點，橘線為 1.1x 平均值 |
260717_ml_advantech_002.png |
29KB | 真資料圖 | 研華 P/E 帶狀圖，Jan-07–2025，含 -1SD／Mean P/E／+1SD 三條參考線，近期落在 +1SD 附近 |
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37KB | 真資料圖 | 研華 P/B 帶狀圖，Jan-07–2025，含 -1SD／Mean P/B／+1SD 三條參考線，近期突破 +1SD |
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60KB | 真資料圖 | 股價（ADTEF）vs 歷次分析師目標價（PO）階梯圖，標示 2023 年至 2026-07-17 間多次 PO 調整節點與對應日期／金額，最近一次階梯為 7-May PO NT$430（本次報告再上修至 NT$515） |
原始內容
Advantech
Above-guidance 2Q sales; positive demand vs. high component cost, fair val'n; Neutral
Reiterate Rating: NEUTRAL | PO: 515.00 TWD | Price: 513.00 TWD
Record-high/above-guidance 2Q26 sales aided by edge AI
Advantech ' s record-high 2Q26 sales of NT$26.1bn (+28% QoQ, +46% YoY) exceeded BofAe/consensus by 25%/21% and surpassed guidance (flat to up 4% QoQ, up 15-18% YoY in NTD terms). June sales of NT$10.1bn (+31% MoM, +73% YoY) also reached a historical high. We attribute the strong 2Q26 sales likely to rising edge AI demand across industries and earlier product pull-in amid memory/component price hike.
Positive tone on demand vs. concern on component cost
According to Advantech ' s latest press release, its overall and regional B/B ratios have consistently remained above 1.0, indicating healthy order momentum and solid endmarket demand across its major markets. Nevertheless, we flag memory/component supply constraints and cost inflation as the key concerns on sales sustainability (with earlier product pull-in) and margin pressure, despite potentially better operating leverage. Our 2Q26E GM/OPM of 39.4%/18.0% therefore remain within guidance of 38.0-40.0%/16.0-18.0% (Exhibit 3). Advantech will hold its in-person 2Q26 analyst meeting at 2pm Taipei time on 5 August.
Lift PO to NT$515; reiterate Neutral on fair valuation
We lift our 2026-28E EPS by 15-21% (Exhibit 1) to reflect 2Q26 preliminary sales, concerns on higher memory/component cost, and better operating leverage. We raise our PO to NT$515 from NT$430, with our valuation methodology unchanged at 28x 2027E EPS. We reiterate Neutral given sales/margin uncertainty amid ongoing memory/component price hikes and fair valuation (trading at around 28x 2027E EPS, in line with our valuation methodology). We also believe the record-high 2Q26/June sales have been well priced in. Advantech ' s share price rose limit-up DoD after it reported June sales on 7 July (vs. TAIEX +1% DoD) and was up 6% since then (vs. TAIEX -6%).
| Estimates (Dec) (NT$) | 2024A | 2025A | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|
| Net Income (Adjusted - mn) | 9,005 | 10,593 | 15,654 | 17,491 | 19,234 |
| EPS | 9.50 | 11.14 | 16.46 | 18.39 | 20.22 |
| EPS Change (YoY) | -17.4% | 17.2% | 47.8% | 11.7% | 10.0% |
| Consensus EPS (Visible Alpha) | 15.73 | 18.75 | 19.93 | ||
| Dividend / Share | 8.40 | 11.20 | 13.99 | 15.63 | 17.19 |
| Free Cash Flow / Share | 9.50 | 7.43 | 10.67 | 15.99 | 18.05 |
| Valuation (Dec) | |||||
| P/E | 54.0x | 46.1x | 31.2x | 27.9x | 25.4x |
| Dividend Yield | 1.6% | 2.2% | 2.7% | 3.0% | 3.4% |
| EV / EBITDA* | 43.1x | 34.2x | 23.1x | 20.3x | 18.3x |
| Free Cash Flow Yield* | 2.0% | 1.6% | 2.3% | 3.4% | 3.9% |
| * For full definitions of iQ method SM measures, see page 8. |
This research report provides general information only. No part of this report may be used or reproduced or quoted in any manner whatsoever in Taiwan by the press or other persons without the express written consent of BofA Securities.
>> Employed by a non-US affiliate of BofAS and is not registered/qualified as a research analyst under the FINRA rules.
Refer to "Other Important Disclosures" for information on certain BofA Securities entities that take responsibility for the information herein in particular jurisdictions.
BofA Securities does and seeks to do business with issuers covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
Refer to important disclosures on page 9 to 11. Analyst Certification on page 6. Price
17 July 2026
Equity
| Key Changes (NT$) | Previous | Current |
|---|---|---|
| Price Obj. | 430.00 | 515.00 |
| 2026E EPS | 13.61 | 16.46 |
| 2027E EPS | 15.36 | 18.39 |
| 2028E EPS | 17.54 | 20.22 |
| 2026E EBITDA (m) | 15,521 | 18,885 |
| 2027E EBITDA (m) | 17,453 | 21,483 |
| 2028E EBITDA (m) | 20,268 | 23,881 |
Robert Cheng >>
Research Analyst
Merrill Lynch (Taiwan)
+886 2 2376 3731
robert.cheng@bofa.com
Doris Kao >> Research Analyst Merrill Lynch (Taiwan) +886 2 2376 3722 doris.kao@bofa.com
Katherine Zhu >>
Research Analyst Merrill Lynch (Hong Kong) +852 3508 3374
kexin.zhu@bofa.com
| Stock Data | |
|---|---|
| Price | 513.00 TWD |
| Price Objective | 515.00 TWD |
| Date Established | 17-Jul-2026 |
| Investment Opinion | A-2-7 |
| 52-Week Range | 271.00 TWD-593.00 |
| TWD | |
| Mrkt Val / Shares Out (mn) | 13,799 USD / 868.3 |
| Market Value (mn) | 445,415 TWD |
| Average Daily Value (mn) | 51.38 USD |
| Free Float | 50.1% |
| BofA Ticker / Exchange | ADTEF / TAI |
| Bloomberg / Reuters | 2395 TT / 2395.TW |
| ROE (2026E) | 26.8% |
| Net Dbt to Eqty (Dec-2025A) | -20.1% |
For a full list of acronyms, see Exhibit 13
iQ profile SM Advantech
| Key Income Statement Data (Dec) | 2024A | 2025A | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|
| (NT$ Millions) | |||||
| Sales | 59,786 | 70,882 | 99,696 | 110,006 | 120,538 |
| Gross Profit | 24,376 | 28,198 | 39,226 | 43,540 | 48,066 |
| Sell General &Admin Expense | (9,910) | (10,815) | (14,159) | (15,422) | (17,050) |
| Operating Profit | 9,050 | 11,567 | 17,843 | 20,281 | 22,428 |
| Net Interest &Other Income | 1,925 | 1,123 | 1,270 | 1,234 | 1,235 |
| Associates | NA | NA | NA | NA | NA |
| Pretax Income | 10,975 | 12,690 | 19,112 | 21,515 | 23,663 |
| Tax (expense) / Benefit | (2,086) | (2,189) | (3,523) | (4,090) | (4,494) |
| Net Income (Adjusted) | 9,005 | 10,593 | 15,654 | 17,491 | 19,234 |
| Average Fully Diluted Shares Outstanding | 948 | 951 | 951 | 951 | 951 |
| Key Cash Flow Statement Data | |||||
| Net Income | 8,771 | 10,409 | 15,524 | 17,361 | 19,103 |
| Depreciation &Amortization | 1,094 | 1,210 | 1,042 | 1,202 | 1,453 |
| Change in Working Capital | 3,292 | (1,432) | (5,106) | (2,026) | (2,060) |
| Deferred Taxation Charge | NA | NA | NA | NA | NA |
| Other Adjustments, Net | (2,647) | (284) | 551 | 530 | 530 |
| Cash Flow from Operations | 10,511 | 9,903 | 12,011 | 17,067 | 19,027 |
| Capital Expenditure | (1,505) | (2,837) | (1,860) | (1,860) | (1,860) |
| (Acquisition) / Disposal of Investments | 122 | 362 | 0 | 0 | 0 |
| Other Cash Inflow / (Outflow) | 914 | (1,746) | 0 | 0 | 0 |
| Cash Flow from Investing | (470) | (4,221) | (1,860) | (1,860) | (1,860) |
| Shares Issue / (Repurchase) | 0 | 0 | 0 | 0 | 0 |
| Cost of Dividends Paid | (8,155) | (7,254) | (8,787) | (9,818) | (10,796) |
| Cash Flow from Financing | (7,792) | (7,846) | (8,787) | (9,818) | (10,796) |
| Free Cash Flow | 9,005 | 7,066 | 10,151 | 15,207 | 17,167 |
| Net Debt | (13,345) | (11,090) | (12,454) | (17,843) | (24,214) |
| Change in Net Debt | (2,689) | 2,255 | (1,364) | (5,389) | (6,371) |
| Key Balance Sheet Data | |||||
| Property, Plant &Equipment | 12,244 | 14,452 | 15,320 | 15,978 | 16,385 |
| Other Non-Current Assets | 17,298 | 18,770 | 18,300 | 17,900 | 17,500 |
| Trade Receivables | 10,124 | 10,535 | 14,818 | 16,350 | 17,916 |
| Cash &Equivalents | 13,617 | 11,317 | 12,681 | 18,070 | 24,442 |
| Other Current Assets | 18,459 | 20,643 | 24,666 | 26,239 | 27,814 |
| Total Assets | 71,742 | 75,718 | 85,785 | 94,538 | 104,056 |
| Long-Term Debt | 156 | 150 | 150 | 150 | 150 |
| Other Non-Current Liabilities | 4,219 | 4,001 | 4,001 | 4,001 | 4,001 |
| Short-Term Debt | 116 | 77 | 77 | 77 | 77 |
| Other Current Liabilities | 15,453 | 16,440 | 19,641 | 20,719 | 21,800 |
| Total Liabilities | 19,945 | 20,668 | 23,868 | 24,947 | 26,028 |
| Total Equity | 51,797 | 55,049 | 61,917 | 69,590 | 78,028 |
| Total Equity &Liabilities | 71,742 | 75,718 | 85,785 | 94,538 | 104,056 |
| iQ method SM - Bus Performance* | |||||
| Return On Capital Employed | 13.9% | 17.1% | 23.6% | 23.8% | 23.6% |
| Return On Equity | 17.9% | 19.8% | 26.8% | 26.6% | 26.1% |
| Operating Margin | 15.1% | 16.3% | 17.9% | 18.4% | 18.6% |
| EBITDA Margin | 17.0% | 18.0% | 18.9% | 19.5% | 19.8% |
| iQ method SM - Quality of Earnings* | |||||
| Cash Realization Ratio | 1.2x | 0.9x | 0.8x | 1.0x | 1.0x |
| Asset Replacement Ratio | 1.6x | 2.9x | 1.9x | 1.5x | 1.3x |
| Tax Rate (Reported) | 19.0% | 17.3% | 18.4% | 19.0% | 19.0% |
| Net Debt-to-Equity Ratio | -25.8% | -20.1% | -20.1% | -25.6% | -31.0% |
| Interest Cover | NM | NM | NM | NM | NM |
Key Metrics
- For full definitions of iQ method SM measures, see page 8.
Company Sector
Electronics
Company Description
Set up in 1983 and listed in 1999, Advantech is global largest Industrial PC vender by providing embedded boards/personal computers, network computing boards, industrial automation products and panel PCs to over 25 vertical channels and global market. Advantech is one of the pioneers to promote smart city and smart manufacturing globally. North America, China, and Europe are Advantech's top-3 markets, accounting for 31%/21%/16% of 2025 sales.
Investment Rationale
We assign a Neutral rating to Advantech as we believe Advantech will benefit from the strong edge AI growth with rising adoption in various vertical markets. However, the company's P/E valuation trades at historical high level. We also view the uncertain macro globally could be a swing factor on the edge AI adoption. We also see potential competition from smaller ODM/EMS names after AI market booming.
| Stock Data | |
|---|---|
| Price to Book Value | 7.2x |
Exhibit 1: We lift our 2026-28E EPS by 15-21%
Earnings estimate revisions summary, 2026-28E
| NT$mn | New | 2026E Old | Diff. | New | 2027E Old | Diff. | New | 2028E Old | Diff. |
|---|---|---|---|---|---|---|---|---|---|
| Sales | 99,696 | 83,949 | 19% | 110,006 | 92,989 | 18% | 120,538 | 104,212 | 16% |
| Gross profit | 39,226 | 33,013 | 19% | 43,540 | 36,801 | 18% | 48,066 | 41,555 | 16% |
| Operating profit | 17,843 | 14,479 | 23% | 20,281 | 16,251 | 25% | 22,428 | 18,815 | 19% |
| Pretax profit | 19,112 | 15,787 | 21% | 21,515 | 17,944 | 20% | 23,663 | 20,509 | 15% |
| Net income | 15,654 | 12,942 | 21% | 17,491 | 14,604 | 20% | 19,234 | 16,678 | 15% |
| EPS (NT$) | 16.46 | 13.61 | 21% | 18.39 | 15.36 | 20% | 20.22 | 17.54 | 15% |
| Margin | |||||||||
| Gross margin | 39.3% | 39.3% | 39.6% | 39.6% | 39.9% | 39.9% | |||
| Operating margin | 17.9% | 17.2% | 18.4% | 17.5% | 18.6% | 18.1% | |||
| Pretax margin | 19.2% | 18.8% | 19.6% | 19.3% | 19.6% | 19.7% | |||
| Net margin | 15.7% | 15.4% | 15.9% | 15.7% | 16.0% | 16.0% |
Source: BofA Global Research estimates. Diff.: difference
Exhibit 2: Our 2026-28E EPS estimates are 10-15% above consensus
BofAe vs consensus, 2026-28E
| 2026E | 2026E | 2026E | 2027E | 2027E | 2027E | 2028E | 2028E | 2028E | |
|---|---|---|---|---|---|---|---|---|---|
| NT$mn | BofAe | Consensus | Diff. | BofAe | Consensus | Diff. | BofAe | Consensus | Diff. |
| Sales | 99,696 | 85,983 | 16% | 110,006 | 96,042 | 15% | 120,538 | 107,155 | 12% |
| Gross profit | 39,226 | 33,949 | 16% | 43,540 | 38,155 | 14% | 48,066 | 42,603 | 13% |
| Operating profit | 17,843 | 15,561 | 15% | 20,281 | 18,342 | 11% | 22,428 | 20,336 | 10% |
| Pretax profit | 19,112 | 16,713 | 14% | 21,515 | 19,479 | 10% | 23,663 | 22,268 | 6% |
| Net income | 15,654 | 13,630 | 15% | 17,491 | 15,827 | 11% | 19,234 | 17,506 | 10% |
| EPS (NT$) | 16.46 | 14.33 | 15% | 18.39 | 16.64 | 11% | 20.22 | 18.41 | 10% |
| Margin | |||||||||
| Gross margin | 39.3% | 39.5% | 39.6% | 39.7% | 39.9% | 39.8% | |||
| Operating margin | 17.9% | 18.1% | 18.4% | 19.1% | 18.6% | 19.0% | |||
| Pretax margin | 19.2% | 19.4% | 19.6% | 20.3% | 19.6% | 20.8% | |||
| Net margin | 15.7% | 15.9% | 15.9% | 16.5% | 16.0% | 16.3% |
Source: BofA Global Research estimates, Bloomberg consensus. Diff.: difference
Exhibit 3: Our 2Q26E EPS is 22% above consensus after reflecting preliminary quarterly sales
2Q26 results preview
| NT$mn | 2Q26 BofAe New | QoQ% | YoY% | 2Q26 BofAe Old | Diff. (%) | Consensus vs. BofAe New | Diff. (%) | 1Q26 | 2Q25 |
|---|---|---|---|---|---|---|---|---|---|
| Sales | 26,126 | 28% | 46% | 20,869 | 25% | 21,540 | 21% | 20,385 | 17,836 |
| Gross profit | 10,296 | 29% | 44% | 8,172 | 26% | 8,503 | 21% | 7,980 | 7,133 |
| Operating profit | 4,705 | 26% | 51% | 3,602 | 31% | 3,901 | 21% | 3,728 | 3,123 |
| Pre-tax profit | 5,016 | 23% | 101% | 3,916 | 28% | 4,147 | 21% | 4,068 | 2,493 |
| Net profit | 4,082 | 22% | 105% | 3,191 | 28% | 3,342 | 22% | 3,334 | 1,989 |
| EPS (NT$) | 4.29 | 22% | 105% | 3.36 | 28% | 3.51 | 22% | 3.51 | 2.09 |
| Margin | |||||||||
| Gross margin | 39.4% | 0.3 ppt | -0.6 ppt | 39.2% | 0.2 ppt | 39.5% | -0.1 ppt | 39.1% | 40.0% |
| Operating margin | 18.0% | -0.3 ppt | 0.5 ppt | 17.3% | 0.7 ppt | 18.1% | -0.1 ppt | 18.3% | 17.5% |
| Pre-tax margin | 19.2% | -0.8 ppt | 5.2 ppt | 18.8% | 0.4 ppt | 19.3% | -0.1 ppt | 20.0% | 14.0% |
| Net margin | 15.6% | -0.7 ppt | 4.5 ppt | 15.3% | 0.3 ppt | 15.5% | 0.1 ppt | 16.4% | 11.2% |
Source: BofA Global Research estimates, company data, Bloomberg consensus. Diff.: difference. ppt: percentage point
BofA GLOBAL RESEARCH
BofA GLOBAL RESEARCH
BofA GLOBAL RESEARCH
Exhibit 4: Advantech's B/B ratio reached a historical high of 1.77x in 1Q26, vs. 1.33x in 4Q25, average of 1.10x, and previous peak of 1.72x in 4Q21 Advantech's book/bill (B/B) ratio trend, 1Q20-1Q26
Source: BofA Global Research, company data. B/B: Book-to-bill (Booking-to-shipment). Mn: Million. RHS: Right Hand Side. US$: US Dollar
Exhibit 5: Advantech's historical P/E average since 2013 is 22x Advantech's P/E with -1/+1 standard deviation since 2013
Source: BofA Global Research, TEJ, Bloomberg
BofA GLOBAL RESEARCH
Exhibit 4: We model Advantech's 2026-28E sales/EPS CAGR of 10%/11%
Quarterly earnings summary, 2025-28E
| NT$mn | 1Q26 | 2Q26E | 3Q26E | 4Q26E | 1Q27E | 2Q27E | 3Q27E | 4Q27E | 1Q28E | 2Q28E | 3Q28E | 4Q28E | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 20,385 | 26,126 | 26,587 | 26,597 | 26,525 | 27,629 | 27,976 | 27,875 | 27,988 | 29,935 | 31,257 | 31,358 | 70,882 | 99,696 | 110,006 | 120,538 |
| Gross profit | 7,980 | 10,296 | 10,481 | 10,470 | 10,427 | 10,932 | 11,110 | 11,071 | 11,105 | 11,924 | 12,519 | 12,517 | 28,198 | 39,226 | 43,540 | 48,066 |
| Operating profit | 3,728 | 4,705 | 4,738 | 4,671 | 4,671 | 5,158 | 5,263 | 5,190 | 5,088 | 5,578 | 5,893 | 5,869 | 11,567 | 17,843 | 20,281 | 22,428 |
| Pretax profit | 4,068 | 5,016 | 5,047 | 4,981 | 4,978 | 5,467 | 5,572 | 5,498 | 5,397 | 5,887 | 6,202 | 6,178 | 12,690 | 19,112 | 21,515 | 23,663 |
| Net income | 3,334 | 4,082 | 4,143 | 4,094 | 4,018 | 4,393 | 4,561 | 4,518 | 4,355 | 4,729 | 5,075 | 5,076 | 10,593 | 15,654 | 17,491 | 19,234 |
| EPS (NT$) | 3.51 | 4.29 | 4.36 | 4.30 | 4.23 | 4.62 | 4.80 | 4.75 | 4.58 | 4.97 | 5.34 | 5.34 | 11.14 | 16.46 | 18.39 | 20.22 |
| Margin% | ||||||||||||||||
| Gross margin | 39.1% | 39.4% | 39.4% | 39.4% | 39.3% | 39.6% | 39.7% | 39.7% | 39.7% | 39.8% | 40.1% | 39.9% | 39.8% | 39.3% | 39.6% | 39.9% |
| Operating margin | 18.3% | 18.0% | 17.8% | 17.6% | 17.6% | 18.7% | 18.8% | 18.6% | 18.2% | 18.6% | 18.9% | 18.7% | 16.3% | 17.9% | 18.4% | 18.6% |
| Pretax margin | 20.0% | 19.2% | 19.0% | 18.7% | 18.8% | 19.8% | 19.9% | 19.7% | 19.3% | 19.7% | 19.8% | 19.7% | 17.9% | 19.2% | 19.6% | 19.6% |
| Net margin | 16.4% | 15.6% | 15.6% | 15.4% | 15.1% | 15.9% | 16.3% | 16.2% | 15.6% | 15.8% | 16.2% | 16.2% | 14.9% | 15.7% | 15.9% | 16.0% |
QoQ %
BofA GLOBAL RESEARCH
Exhibit 6: Advantech's historical P/B average since 2007 is 3.8x Advantech's P/B with -1/+1 standard deviation since 2007
BofA GLOBAL RESEARCH
Source: BofA Global Research, TEJ, Bloomberg
Exhibit 4: We model Advantech's 2026-28E sales/EPS CAGR of 10%/11%
Quarterly earnings summary, 2025-28E
| NT$mn | 1Q26 | 2Q26E | 3Q26E | 4Q26E | 1Q27E | 2Q27E | 3Q27E | 4Q27E | 1Q28E | 2Q28E | 3Q28E | 4Q28E | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 14% | 28% | 2% | 0% | 0% | 4% | 1% | 0% | 0% | 7% | 4% | 0% | ||||
| Gross profit | 12% | 29% | 2% | 0% | 0% | 5% | 2% | 0% | 0% | 7% | 5% | 0% | ||||
| Operating profit | 33% | 26% | 1% | -1% | 0% | 10% | 2% | -1% | -2% | 10% | 6% | 0% | ||||
| Pretax profit | 11% | 23% | 1% | -1% | 0% | 10% | 2% | -1% | -2% | 9% | 5% | 0% | ||||
| Net income | 7% | 22% | 1% | -1% | -2% | 9% | 4% | -1% | -4% | 9% | 7% | 0% | ||||
| YoY% | ||||||||||||||||
| Sales | 17% | 46% | 50% | 48% | 30% | 6% | 5% | 5% | 6% | 8% | 12% | 12% | 19% | 41% | 10% | 10% |
| Gross profit | 14% | 44% | 52% | 47% | 31% | 6% | 6% | 6% | 7% | 9% | 13% | 13% | 16% | 39% | 11% | 10% |
| Operating profit | 28% | 51% | 75% | 66% | 25% | 10% | 11% | 11% | 9% | 8% | 12% | 13% | 28% | 54% | 14% | 11% |
| Pretax profit | 26% | 101% | 54% | 35% | 22% | 9% | 10% | 10% | 8% | 8% | 11% | 12% | 16% | 51% | 13% | 10% |
| Net income | 22% | 105% | 50% | 32% | 21% | 8% | 10% | 10% | 8% | 8% | 11% | 12% | 18% | 48% | 12% | 10% |
Source: BofA Global Research estimates, company data
Exhibit 13: Acronyms
Acronyms used in the report
| Acronym | Acronym | Acronym | Acronym | Acronym | |
|---|---|---|---|---|---|
| AI | Artificial Intelligence | NTD/NT$ | New Taiwan Dollar | RHS | Right Hand Side |
| B/B ratio | Book-to-Bill ratio | OPM | Operating Profit Margin | S.D. | Standard Deviation |
| CAGR | Compound Annual Growth Rate | P/B | Price to Book Value Ratio | TAIEX | Taiwan Exchange Index |
| DoD | Day-over-Day | P/E | Price to Earnings Ratio | USD/US$ | US Dollar |
| EPS | Earnings Per Share | PO | Price Objective | Val'n | Valuation |
| GM | Gross Margin | ppt | Percentage Point |
Source:
BofA Global Research
BofA GLOBAL RESEARCH
BofA GLOBAL RESEARCH
Price objective basis & risk
Advantech (ADTEF)
We set our PO at NT$515 (28x 2027E EPS). We apply 28x P/E multiple, which is around 1.0SD above the company's historical trading average since 2013, to capture Advantech's double-digit% YoY sales/earnings CAGR expected in 2026-28E, supported by rising edge AI contribution and global supply-chain's increasing capex. We view our target valuation as fair with improving B/B ratio, bullish outlook with rising edge AI in vertical markets, and higher capex in Taiwan and US.
Upside risks to our PO are: (1) stronger demand recovery in the US and Europe, (2) faster- and higher-than-expected China recovery, and (3) stronger-than-expected edge AI sales growth.
Downside risks are: (1) slower-than-expected global market demand due to macro uncertainties, (2) slower-than-expected China recovery, (3) slower progress in service IoT and software business, and (4) weaker-than-expected edge AI sales growth.