Right Way Industrial Co., Ltd. (1506) AI Stock Analysis

Right Way Industrial Co., Ltd.

(TWSE:1506)

Select Model

Rating:44Neutral

Price Target:TWD 9.00▼(-3.02% Downside)

Action:initiatedcoverage

Date:11/09/26

Right Way Industrial scores poorly overall. The dominant drag is deteriorating profitability: flat revenue, an operating loss in 2025, a 1.7% net margin, sub-1% return on equity, and negative free cash flow despite improved operating cash flow. This is partly cushioned by a fortress balance sheet — essentially no debt, 85% equity funding of assets and ample flexibility to absorb a weak patch. Technicals add further pressure, with the price below all major moving averages, a negative MACD and deeply depressed RSI/Stochastic readings. Valuation offers little support given a ~209x P/E on depressed earnings and no dividend. Earnings call and corporate event components were excluded for lack of data, with their weight redistributed to the remaining factors.

Positive Factors

Very Low LeverageVery low leverage and a substantial equity base give Right Way Industrial financial flexibility to withstand operating weakness and fund necessary investment without relying heavily on creditors. This strengthens resilience and preserves room for future capital allocation if profitability improves.

Negative Factors

Material Margin CompressionThe sustained decline in net margin signals weakening earnings quality and reduced profitability from each unit of revenue. If this compression persists, it will limit internal capital generation, reduce returns on the equity base, and make future earnings recovery more dependent on cost or pricing improvements.

Right Way Industrial Co., Ltd. (1506) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 2.77B
Dividend Yield: ―
Average Volume (3M): 191.45K
Price to Earnings (P/E): 213.4
Beta (1Y): 0.23
Revenue Growth: 6.47%
EPS Growth: -2.14%
Country: TW
Employees: 1,049
Sector: General
Sector Strength: 55
Industry: Auto - Parts

Right Way Industrial Co., Ltd. Business Overview & Revenue Model

Company Description

Established in 1964 and headquartered in Tainan City, Taiwan, Right Way Industrial Co.,Ltd operates globally, specializing in the production and distribution of automotive parts. The company crafts a diverse range of cast and forged components using...

Right Way Industrial Co., Ltd. Financial Statement Overview

Summary

A very strong balance sheet (score 82) is offset by weak earnings and cash generation. Borrowings of just NT$62 million against NT$2.79 billion of equity leave the company effectively debt-free with minimal financial risk. However, revenue has been flat near NT$1.0–1.1 billion for four years, core operating profit slipped into a small loss in 2025 (EBIT margin ~-0.1% vs 5.8% in 2024), net margin compressed to 1.7%, and return on equity fell below 1%. Operating cash flow improved to NT$65.2 million and exceeded net income, but heavy capital spending kept free cash flow negative at -NT$82.7 million, the fourth negative year in six. Financial staying power is high; earnings power is weak.

Income Statement

34Negative

Balance Sheet

82Very Positive

Cash Flow

38Negative

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.14B	1.07B	1.04B	1.14B	1.14B	1.06B
Gross Profit	164.96M	175.04M	168.73M	184.74M	202.62M	154.03M
EBITDA	47.09M	51.02M	108.95M	149.98M	174.17M	162.48M
Net Income	13.72M	18.33M	41.72M	86.66M	95.22M	42.88M
Balance Sheet
Total Assets	3.31B	3.30B	3.17B	3.18B	2.82B	2.43B
Cash, Cash Equivalents and Short-Term Investments	75.55M	217.82M	433.25M	556.24M	256.92M	339.32M
Total Debt	71.29M	62.17M	61.14M	57.30M	59.36M	890.70M
Total Liabilities	433.86M	426.92M	376.21M	386.49M	422.09M	1.35B
Stockholders Equity	2.80B	2.79B	2.72B	2.72B	2.33B	1.03B
Cash Flow
Free Cash Flow	-165.23M	-82.73M	-52.53M	146.33M	-392.15M	125.36M
Operating Cash Flow	-32.98M	65.24M	18.47M	209.93M	71.18M	142.67M
Investing Cash Flow	-189.63M	-255.75M	-147.66M	-289.95M	-404.32M	-127.19M
Financing Cash Flow	36.70M	-1.97M	982.00K	322.96M	336.68M	137.88M

Right Way Industrial Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:1506 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:1339	71Outperform	TWD 2.94B	7.33	―	6.26%	-10.90%	163.84%
TW:2248	66Neutral	TWD 2.76B	10.92	―	5.35%	35.53%	59.41%
TW:1568	63Neutral	TWD 2.69B	14.52	―	3.64%	4.95%	65.01%
TW:2115	59Neutral	TWD 2.40B	12.56	―	6.54%	13.54%	-9.75%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:1506	44Neutral	TWD 2.72B	213.43	―	―	6.47%	-2.14%
TW:1533	39Underperform	TWD 2.44B	9.23	―	―	20.93%	285.82%

* General Sector Average

Performance Comparison

TW:1506 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:1506	Right Way Industrial Co., Ltd.	9.28	-2.87	-23.62%
TW:1339	Y.C.C. Parts Mfg. Co., Ltd.	39.95	-1.58	-3.80%
TW:1533	Mobiletron Electronics Co., Ltd.	24.75	-8.35	-25.23%
TW:1568	Tsang Yow Industrial Co., Ltd.	27.45	6.22	29.32%
TW:2115	Lu Hai Holding Corp.	22.95	-1.40	-5.76%
TW:2248	Shining Victory Motor Electronic Co., Ltd.	58.00	11.01	23.43%

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.

Date of analysis: Nov 09, 2026

Right Way Industrial Co., Ltd. AI Stock Analysis