Champion Building Materials Co., Ltd. (1806) AI Stock Analysis

Champion Building Materials Co., Ltd.

(TWSE:1806)

Select Model

Rating:42Neutral

Price Target:TWD 7.00▼(-5.28% Downside)

Action:initiatedcoverage

Date:11/09/26

Champion Building Materials scores poorly overall, driven mainly by weak operating performance: declining revenue, compressing margins, a 2.1% return on equity and a sharp deterioration in cash flow, with free cash flow turning negative as debt-funded capital spending accelerated. A conservatively capitalized balance sheet — equity covering 64% of assets and debt-to-equity of 0.38 — provides financial staying power and is the main offset. Technicals reinforce the caution, with the stock below all key moving averages and negative MACD momentum, while a P/E of 47.4 against thin earnings leaves valuation unsupportive despite a 2.0% dividend yield. Improvement hinges on current capital projects reviving revenue growth, margins and cash generation.

Positive Factors

Manageable LeverageModerate leverage and a sizable equity base provide financial resilience for a cyclical building-materials business. This supports continued operations and investment capacity, while leaving the company better positioned to absorb fluctuations in construction activity than a heavily indebted peer.

Negative Factors

Revenue ContractionThe 2025 revenue decline indicates that recent top-line momentum has weakened after modest growth in the prior two years. Continued contraction would reduce operating leverage, limit reinvestment capacity, and make it harder for the company to improve earnings consistently.

Champion Building Materials Co., Ltd. (1806) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 2.83B
Dividend Yield: 2.03%
Average Volume (3M): 190.63K
Price to Earnings (P/E): 46.7
Beta (1Y): 0.07
Revenue Growth: -17.09%
EPS Growth: -51.53%
Country: TW
Employees: 698
Sector: General
Sector Strength: 55
Industry: Construction Materials

Champion Building Materials Co., Ltd. Business Overview & Revenue Model

Company Description

Champion Building Materials Co., Ltd., along with its affiliated companies, specializes in the production and distribution of various ceramic goods, stone items, fire-resistant substances, and other chemical products. The enterprise is structured int...

Champion Building Materials Co., Ltd. Financial Statement Overview

Summary

Weak and inconsistent earnings power is only partly offset by a conservative balance sheet. Revenue fell 4.6% to about NT$3.26 billion, gross margin compressed to 22.8% from 25.9%, operating margin narrowed to 5.3%, and net margin was a razor-thin 3.4% (net income ~NT$112 million), with losses recorded in three of the past six years (Income Statement: 38). The balance sheet is the strongest pillar — equity of NT$5.27 billion funds ~64% of assets and debt-to-equity is a manageable 0.38 — but return on equity of just 2.1% shows capital is not being deployed productively, and leverage has crept up from 0.31 (Balance Sheet: 62). Cash flow is the biggest near-term concern: operating cash flow fell 58% to ~NT$275 million and heavy capex of ~NT$410 million pushed free cash flow to negative NT$135 million, though profits remain cash-backed at ~2.4x net income (Cash Flow: 35).

Income Statement

38Negative

Balance Sheet

62Positive

Cash Flow

35Negative

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Mar 2023	Dec 2021
Income Statement
Total Revenue	2.92B	3.26B	3.43B	3.14B	3.01B	3.21B
Gross Profit	588.95M	743.79M	889.01M	905.31M	863.12M	753.87M
EBITDA	461.74M	547.50M	564.17M	504.25M	383.14M	1.76B
Net Income	58.65M	112.21M	119.34M	-49.69M	-188.24M	991.50M
Balance Sheet
Total Assets	7.95B	8.17B	8.32B	7.99B	8.33B	9.52B
Cash, Cash Equivalents and Short-Term Investments	1.44B	2.07B	2.22B	1.96B	2.22B	3.02B
Total Debt	1.43B	2.02B	1.75B	1.60B	1.71B	1.65B
Total Liabilities	2.69B	2.91B	2.75B	2.60B	2.89B	3.02B
Stockholders Equity	5.26B	5.27B	5.57B	5.40B	5.45B	6.50B
Cash Flow
Free Cash Flow	21.58M	-135.16M	2.77M	83.58M	60.97M	-112.28M
Operating Cash Flow	162.17M	274.98M	656.55M	292.77M	405.52M	29.98M
Investing Cash Flow	1.11M	-175.92M	-491.89M	-80.42M	-500.39M	1.80B
Financing Cash Flow	-529.78M	-106.93M	40.17M	-291.45M	-750.98M	-1.20B

Champion Building Materials Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:1806 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:1817	71Outperform	TWD 2.88B	7.89	―	5.54%	-0.86%	21.67%
TW:6881	69Neutral	TWD 3.23B	10.53	―	8.60%	-1.38%	17.17%
TW:1341	62Neutral	TWD 3.05B	11.73	―	6.93%	1.01%	22.95%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:8463	53Neutral	TWD 3.19B	10.76	―	3.76%	-3.02%	-15.76%
TW:4720	51Neutral	TWD 3.12B	50.03	―	1.47%	2.43%	-43.09%
TW:1806	42Neutral	TWD 2.89B	46.68	―	2.03%	-17.09%	-51.53%

* General Sector Average

Performance Comparison

TW:1806 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:1806	Champion Building Materials Co., Ltd.	7.39	-1.50	-16.85%
TW:1341	Fulin Plastic Industry (Cayman) Holding Co., Ltd.	57.70	2.89	5.27%
TW:1817	Sanitar Co., Ltd.	39.70	2.60	7.01%
TW:4720	Tex Year Industries, Inc.	27.25	13.29	95.19%
TW:6881	Ruentex Interior Design, Inc.	215.00	0.38	0.18%
TW:8463	Ruentex Materials Co Ltd	21.30	-3.95	-15.65%

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

Champion Building Materials Co., Ltd. AI Stock Analysis