SDI Corporation (2351) AI Stock Analysis

SDI Corporation

(TWSE:2351)

Select Model

Rating:47Neutral

Price Target:TWD 131.00▼(-9.97% Downside)

Action:initiatedcoverage

Date:11/09/26

SDI Corporation scores below average, driven primarily by deteriorating profitability: four consecutive years of revenue decline, gross margin down to 12.7%, net margin of 3.0% and return on equity of just 4.4%. This is partly offset by a solid balance sheet (0.45 debt-to-equity, equity funding over half of assets) and steady operating cash flow of roughly NT$1.2bn that exceeds reported profits, giving the company room to weather the trough. Technicals add to the caution, with the price trading far below all key moving averages and a sharply negative MACD, although extreme RSI and Stochastic readings suggest the selling is stretched in the near term. Valuation provides little support, as a P/E of 32.6 on depressed earnings and a modest 0.77% dividend yield leave limited cushion. Earnings call and corporate event data were unavailable and therefore excluded from the score.

Positive Factors

Improving LeverageDebt reduction relative to equity indicates a more conservative capital structure and provides greater financial flexibility. This can help the company withstand earnings pressure, preserve borrowing capacity, and retain room to fund operations or strategic investment over the next several quarters.

Negative Factors

Structural Margin CompressionThe multi-year decline in gross and operating margins shows that profitability has weakened materially rather than reflecting only a single-period fluctuation. Persistently lower margins reduce earnings resilience, limit reinvestment capacity, and make future profits more sensitive to revenue conditions.

SDI Corporation (2351) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 30.32B
Dividend Yield: 0.71%
Average Volume (3M): 4.73M
Price to Earnings (P/E): 35.6
Beta (1Y): 1.44
Revenue Growth: 6.77%
EPS Growth: 105.57%
Country: TW
Employees: 2,632
Sector: General
Sector Strength: 55
Industry: Semiconductors

SDI Corporation Business Overview & Revenue Model

Company Description

SDI Corporation, operating with its various subsidiaries, is involved in the production and distribution of a diverse array of goods. These offerings include lead frames for semiconductors and LEDs, various stationery and office supplies, and precisi...

SDI Corporation Financial Statement Overview

Summary

A conservatively financed business caught in a clear cyclical downturn. The balance sheet is the anchor (score 66): equity funds about 55% of the NT$12.7bn asset base, debt-to-equity is a moderate 0.45, and debt of roughly 2.6x EBITDA remains manageable. Cash flow is adequate (score 55): operating cash flow of about NT$1.17bn was flat year over year and nearly four times net income, signalling high earnings quality, though heavy capex of NT$0.93bn cut free cash flow by roughly 60% to NT$232m. The weak link is the income statement (score 41): a fourth straight year of revenue decline to about NT$10.2bn, gross margin compression from 17.7% to 12.7%, operating margin down to 4.9%, net margin to 3.0%, and return on equity falling to 4.4% as net income more than halved in two years.

Income Statement

41Neutral

Balance Sheet

66Positive

Cash Flow

55Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	11.49B	10.25B	10.81B	10.86B	11.72B	11.15B
Gross Profit	1.95B	1.30B	1.72B	1.85B	2.08B	2.11B
EBITDA	1.72B	1.20B	1.67B	1.74B	2.01B	1.90B
Net Income	757.83M	303.19M	675.10M	742.76M	940.52M	852.24M
Balance Sheet
Total Assets	14.69B	12.74B	12.54B	12.15B	12.93B	13.04B
Cash, Cash Equivalents and Short-Term Investments	1.62B	1.16B	1.20B	934.14M	1.19B	814.94M
Total Debt	3.04B	3.12B	2.90B	2.72B	3.29B	3.65B
Total Liabilities	6.12B	5.46B	5.12B	5.03B	5.94B	6.51B
Stockholders Equity	8.18B	6.96B	7.06B	6.77B	6.63B	6.19B
Cash Flow
Free Cash Flow	136.41M	232.25M	582.90M	1.02B	1.17B	-680.05M
Operating Cash Flow	1.08B	1.17B	1.19B	1.73B	2.00B	520.58M
Investing Cash Flow	-1.05B	-1.10B	-556.34M	-689.40M	-838.42M	-1.22B
Financing Cash Flow	303.36M	-150.45M	-402.01M	-1.26B	-802.58M	641.95M

SDI Corporation Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:2351 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:2428	69Neutral	TWD 24.85B	13.78	―	3.04%	19.78%	25.02%
TW:8131	65Neutral	TWD 23.84B	13.29	―	1.86%	37.20%	416.69%
TW:3605	64Neutral	TWD 22.61B	31.74	―	1.22%	13.61%	-8.06%
TW:2329	56Neutral	TWD 24.47B	14.80	―	2.68%	10.61%	51.02%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:3376	48Neutral	TWD 23.40B	82.07	―	3.35%	-21.58%	-63.49%
TW:2351	47Neutral	TWD 28.19B	35.57	―	0.71%	6.77%	105.57%

* General Sector Average

Performance Comparison

TW:2351 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:2351	SDI Corporation	145.50	59.37	68.93%
TW:2329	Orient Semiconductor Electronics, Limited	37.30	-14.60	-28.13%
TW:2428	Thinking Electronic Industrial Co., Ltd.	194.00	6.50	3.46%
TW:3376	Shin Zu Shing Co., Ltd.	119.50	-64.92	-35.20%
TW:3605	ACES Electronics Co., Ltd.	129.00	62.56	94.15%
TW:8131	Formosa Advanced Technologies Co., Ltd.	53.90	6.24	13.10%

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

SDI Corporation AI Stock Analysis