- Hua Hong Semiconductor‘s net income for Q3 was $25.7 million, falling short of the estimated $27.2 million.
- The company’s revenue exceeded expectations, reaching $635.2 million compared to the estimate of $632.4 million.
- Revenue from 8-inch wafers was $258.8 million, surpassing the projected $237.7 million.
- 12-inch wafer revenue fell below forecasts, totaling $376.4 million against an expectation of $398.6 million.
- Hua Hong achieved a gross margin of 13.5%, higher than the anticipated 11.3% margin.
- Capital expenditure was significantly lower than expected at $261.9 million, with an estimate of $583.6 million.
- Market recommendations include 22 buys, 7 holds, and 5 sells.
Hua Hong Semiconductor on Smartkarma
On Smartkarma, independent analyst Nicolas Baratte recently published a research report on Hua Hong Semiconductor with a bearish sentiment. Baratte forecasts continued poor margins and operating losses for the company in 2025 due to rapid capacity expansion and escalating depreciation and amortization costs outpacing revenue growth. The analyst believes that consensus earnings per share (EPS) estimates are overly optimistic, highlighting the stock’s expensiveness at 43 times the forecasted 2025 EPS. Baratte anticipates a persisting operating loss in the second quarter of 2025 and throughout the year, cautioning against overlooking potential slowdowns in end-demand triggered by US import tariffs and sluggish domestic consumption in China. Despite Hua Hong’s reported full capacity utilization, Baratte underscores the disconnect between expectations and financial realities, suggesting that consensus EPS projections for 2025 and beyond may be overstated.
A look at Hua Hong Semiconductor Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 2 | |
| Growth | 2 | |
| Resilience | 3 | |
| Momentum | 5 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Analysts assessing Hua Hong Semiconductor‘s long-term outlook have factored in various Smartkarma Smart Scores to gauge the company’s overall performance. With a solid Momentum score of 5, indicating strong upward performance trends, investors see potential growth opportunities in the company. While Value and Resilience scores stand at 3, reflecting a stable market position and reasonable valuation, the Dividend and Growth scores at 2 suggest room for improvement in these areas. Despite mixed scores, Hua Hong Semiconductor‘s strategic focus on specialty semiconductor manufacturing for diverse industries positions it well for future market demands.
Hua Hong Semiconductor Limited, known for producing semiconductors on 200mm wafers for specialty applications across various sectors like consumer electronics, communication, computing, industrial, and automotive industries. The company’s Smartkarma Smart Scores provide insights into its performance outlook, indicating a mix of strengths and areas for enhancement. Investors eyeing the company may find the strong Momentum score promising for potential returns, while recognizing opportunities for growth and dividend improvement based on the Value, Growth, and Dividend scores provided.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
Have feedback on this article? Concerned about the content? Get in touch with us directly.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Analytics and News
- ✓ Events & Webinars
