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ASE Technology Holding Co
(NYSE:ASX)
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Rating:53Neutral
Price Target:
$40.00
▲(8.58% Upside)
Action:Reiterated
Date:07/31/26
The score is held back primarily by weak cash-flow quality and a high-capex funding burden, despite improving revenue/margin performance and a generally solid balance sheet. Near-term technicals are also weak (below 20/50-day averages) and valuation is expensive (P/E ~51), while the latest earnings call was a positive offset due to strong growth guidance and improving segment margins.
Positive Factors
Sustained Revenue & Margin Momentum
ASE shows multi-quarter top-line recovery and expanding margins driven by higher-margin packaging/testing mix. Durable demand and improving operating leverage suggest the company can sustain earnings growth across cycles as advanced packaging adoption and AI-related content increase per-customer volumes over 2–6 months and beyond.
Negative Factors
Deeply Negative Free Cash Flow
Persistent negative free cash flow driven by heavy investment undermines cash conversion despite operating profitability. Over 2–6 months, continued negative FCF constrains flexibility for opportunistic R&D, M&A or dividends and increases reliance on external funding, raising financial vulnerability if industry demand weakens.
Read all positive and negative factors
Positive Factors
Negative Factors
Sustained Revenue & Margin Momentum
ASE shows multi-quarter top-line recovery and expanding margins driven by higher-margin packaging/testing mix. Durable demand and improving operating leverage suggest the company can sustain earnings growth across cycles as advanced packaging adoption and AI-related content increase per-customer volumes over 2–6 months and beyond.
Read all positive factors
ASE Technology Holding Co (ASX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$84.75B
Dividend Yield1.11%
Average Volume (3M)10.72M
Price to Earnings (P/E)44.2
Beta (1Y)1.62
Revenue Growth18.30%
EPS Growth82.12%
CountryUS
Employees96,436
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)27.74
Shares Outstanding2,235,286,100
10 Day Avg. Volume8,844,268
30 Day Avg. Volume10,723,769
Financial Highlights & Ratios
PEG Ratio1.09
Price to Book (P/B)3.16
Price to Sales (P/S)1.69
P/FCF Ratio-54.72
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$48.00Price Target Upside30.29% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)1.13
Revenue Forecast (FY)$25.63B
ASE Technology Holding Co Business Overview & Revenue Model
Company Description
Established in 1984 and headquartered in Kaohsiung, Taiwan, ASE Technology Holding Co., Ltd. operates as a leading global provider of essential services for the semiconductor industry. Its primary business encompasses a full range of semiconductor...
How the Company Makes Money
ASE Technology Holding Co. primarily makes money by charging semiconductor and electronics customers for outsourced back-end manufacturing services. Its core revenue stream is OSAT (outsourced semiconductor assembly and test): (1) packaging/assemb...
ASE Technology Holding Co Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 22, 2026
Earnings Call Sentiment Positive
The call conveyed a strongly positive operational and financial momentum driven by LEAP and ATM businesses: record ATM revenues, significant YoY and QoQ revenue and profit growth, margin expansion, and a clear roadmap to scale LEAP (targeting to double in 2027). These strengths are tempered by near-term capacity constraints, substantial and ongoing CapEx (pressuring free cash flow and raising debt), EMS margin pressures from product mix and component cost volatility, and execution/timing risk for multiple simultaneous factory builds and new technology ramps. On balance, the upbeat revenue, margin trends and clear demand visibility outweigh the execution and funding challenges.Positive Updates
Strong consolidated top-line and earnings growth
Q2 consolidated net revenues TWD 191.1 billion (+10% QoQ, +27% YoY). Q2 net income TWD 21.1 billion (+49% QoQ, +180% YoY). Q2 diluted EPS TWD 4.61 and basic EPS TWD 4.80.
Negative Updates
Near-term capacity constraints and execution risk
Blended utilization ~80–85%; management states near-term incremental growth is gated by ability to install capital equipment and build facilities. Company is executing many projects concurrently (13 greenfield, ~8 brownfield), increasing execution and timing risk.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong consolidated top-line and earnings growth
Q2 consolidated net revenues TWD 191.1 billion (+10% QoQ, +27% YoY). Q2 net income TWD 21.1 billion (+49% QoQ, +180% YoY). Q2 diluted EPS TWD 4.61 and basic EPS TWD 4.80.
Read all positive updates
Company Guidance
Management guided Q3 consolidated revenue to rise 21–22% QoQ (FX assumption USD1 = TWD31.9), with consolidated gross margin pegged at 12.5%–21.5% and consolidated operating margin of 11.5%–12.5%; ATM revenue is expected to grow 11%–13% QoQ with ATM gross margin of 28%–29% (full‑year ATM revenue forecast ~+35% YoY), EMS revenue is forecast to jump ~40% QoQ with EMS operating margin of 3.2%–3.4%, and management reiterated LEAP services are tracking ahead of prior guidance of USD3.5B (adding “a couple hundred million” this year) and they aim to double LEAP revenue in 2027. To fund the ramp they will add an incremental USD2.0B of CapEx this year (USD1.0B each for facilities and equipment), bringing 2026 CapEx to about USD10.5B (≈USD4.0B buildings/facilities and USD6.5B equipment; equipment split ~56% assembly/40% test and ~70% of equipment spend for leading edge). Management also highlighted H1 metrics and capacity tightness: consolidated H1 revenue +24% YoY, H1 ATM +35% YoY, blended utilization ~80%–85%, H1 machinery CapEx USD2.7B and H1 facility spend USD1.4B, and they expect Q4 ATM gross margin to exceed the prior structural ceiling of 30%.ASE Technology Holding Co Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
71
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 714.69B | 648.92B | 607.72B | 574.18B | 679.14B | 564.46B |
| Gross Profit | 139.30B | 114.82B | 93.49B | 85.73B | 132.56B | 104.89B |
| EBITDA | 156.92B | 125.02B | 108.53B | 103.37B | 140.56B | 134.64B |
| Net Income | 61.08B | 40.88B | 33.15B | 31.30B | 62.86B | 63.29B |
Balance Sheet | ||||||
| Total Assets | 1.07T | 889.33B | 741.06B | 667.39B | 707.59B | 673.27B |
| Cash, Cash Equivalents and Short-Term Investments | 107.37B | 101.70B | 85.87B | 71.97B | 65.60B | 79.15B |
| Total Debt | 296.44B | 264.10B | 201.41B | 179.22B | 190.07B | 215.68B |
| Total Liabilities | 652.14B | 515.97B | 398.79B | 352.64B | 394.31B | 405.09B |
| Stockholders Equity | 389.20B | 346.90B | 320.03B | 294.48B | 294.67B | 253.63B |
Cash Flow | ||||||
| Free Cash Flow | -241.27B | -20.01B | 2.97B | 51.09B | 30.98B | 7.62B |
| Operating Cash Flow | 330.06B | 143.03B | 84.74B | 104.56B | 105.21B | 78.79B |
| Investing Cash Flow | -583.20B | -166.55B | -86.53B | -54.87B | -75.98B | -54.95B |
| Financing Cash Flow | 277.38B | 45.52B | -6.53B | -47.97B | -62.11B | 524.22M |
ASE Technology Holding Co Technical Analysis
Negative
36.84
Price Trends
38.76
Negative
34.67
Positive
26.52
Positive
Market Momentum
0.04
Negative
45.05
Neutral
62.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ASX, the sentiment is Negative. The current price of 36.84 is below the 20-day moving average (MA) of 37.31, below the 50-day MA of 38.76, and above the 200-day MA of 26.52, indicating a neutral trend. The MACD of 0.04 indicates Negative momentum. The RSI at 45.05 is Neutral, neither overbought nor oversold. The STOCH value of 62.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ASX.
ASE Technology Holding Co Risk Analysis
ASE Technology Holding Co disclosed 51 risk factors in its most recent earnings report. ASE Technology Holding Co reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Failure to grasp the future development of AI could adversely affect our business, financial condition, and results of operations. Q4, 2023
ASE Technology Holding Co Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $47.86B | 18.16 | 20.98% | 2.12% | 9.07% | 104.71% | |
67 Neutral | $32.46B | 52.77 | 8.38% | ― | -3.14% | 44.55% | |
67 Neutral | $29.32B | 41.11 | 6.07% | 0.22% | 1.40% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $15.23B | 27.37 | 12.37% | 0.51% | 17.93% | 82.27% | |
56 Neutral | $50.66B | 107.26 | 2.66% | 0.70% | 10.06% | -27.68% | |
53 Neutral | $84.75B | 44.21 | 17.32% | 1.13% | 18.30% | 82.12% |
* Technology Sector Average
ASX
ASE Technology Holding Co
36.41
26.79
278.56%
AMKR
Amkor
54.84
32.04
140.48%
ON
ON Semiconductor
79.42
29.95
60.54%
STM
STMicroelectronics
52.27
26.50
102.85%
UMC
United Micro
18.48
11.70
172.61%
GFS
GlobalFoundries Inc
49.90
16.93
51.34%
ASE Technology Holding Co Corporate Events
ASE Technology Holding Posts Strong July 2026 Revenue Growth
Aug 10, 2026
On August 10, 2026, ASE Technology Holding Co. reported unaudited consolidated net revenues for July 2026, highlighting a strong uplift in sales compared with both the previous month and the prior year. July consolidated net revenues reached NT$73...
ASE Technology Holding Prices US$1 Billion Currency-Linked Convertible Bond to 2031
Aug 3, 2026
On August 3, 2026, ASE Technology Holding Co. announced it had priced a US$1 billion offering of currency linked zero coupon convertible bonds due 2031, sold outside the United States under Regulation S. The proceeds are earmarked for capital cont...
ASE Technology Files Reviewed Q1 2025–2026 Financials in Form 6-K
Aug 3, 2026
ASE Technology Holding Co. filed a Form 6-K dated August 3, 2026, providing English-translated consolidated financial statements for the three months ended March 31, 2025 and 2026, together with an independent auditors’ review report. Deloit...
ASE Technology Holding Posts Strong Q2 2026 Growth and Steps Up AI-Focused Capex
Jul 30, 2026
In the second quarter of 2026, ASE Technology Holding reported strong momentum in its core semiconductor packaging, testing and electronics manufacturing businesses, with total net revenues rising 27% year-on-year to NT$191.1 billion and ATM reven...
ASE Technology Holding Posts Strong 2Q26 Profit Surge and Invests Heavily in Capacity
Jul 30, 2026
On July 30, 2026, ASE Technology Holding Co. reported unaudited consolidated net revenues of NT$191,064 million for the second quarter of 2026, up 26.7% year-on-year and 10.0% sequentially. Net income attributable to shareholders surged to NT$21,0...
ASE Technology Holding Posts Strong June and Q2 2026 Revenue Growth Driven by ATM Business
Jul 9, 2026
On July 9, 2026, ASE Technology Holding reported unaudited consolidated net revenues for June 2026 of NT$65.8 billion (US$2.09 billion), up 4.4% month-on-month and 32.9% year-on-year, underscoring strong demand in its core semiconductor services. ...
ASE Technology Holding Posts Strong May 2026 Revenue Growth on ATM Strength
Jun 9, 2026
On June 9, 2026, ASE Technology Holding reported unaudited consolidated net revenues for May 2026 of NT$63.03 billion (US$2.00 billion), up 1.3% month on month and 28.6% year on year, signaling robust demand and strengthening top-line momentum. Th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.