PETALING JAYA: Analysts are mixed on the prospects of UWC Bhd
after its core net profit for the six months ended Jan 31, 2024 missed consensus forecasts.
According to Phillip Capital, the metal fabrication and value-added assembly services provider to the semiconductor industry saw its core net profit declining 89% year-on year, mainly dragged by higher operating costs incurred for its front-end customers, coupled with consolidated losses of its newly acquired subsidiaries.
Revenue for the six-month period shrank by 42% due to lower contribution from the semiconductor industry, which was undergoing a cyclical downturn.
Global economic uncertainty and trade tensions had led to softening demand for electronics products and technological devices, affecting the semiconductor industry’s performance.
Despite missing consensus, Phillip Capital has maintained a “buy” call on the stock with a 12-month target price of RM4.31, based on a 35 times price-earnings multiple on financial year 2025 earnings per share.
