Tongtai Machine & Tool Co., Ltd (4526) AI Stock Analysis

Tongtai Machine & Tool Co., Ltd

(TWSE:4526)

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Rating:52Neutral

Price Target:TWD 50.00▼(-12.89% Downside)

Action:initiatedcoverage

Date:11/09/26

Tongtai scores in the below-average range, weighed down primarily by weak fundamentals: a revenue base that has shrunk by nearly half since 2021, a still-negative operating result, and sharply negative operating and free cash flow despite a reported net profit — a combination that points to poor earnings quality and funding pressure given debt of roughly 1.06x equity. Offsetting this is impressive technical strength, with the price trading well above all key moving averages and a strongly positive MACD, though the elevated stochastic reading suggests the rally is extended near term. Valuation adds little comfort, with a negative P/E and only a modest 2.03% dividend yield of uncertain sustainability. Investors should look for a genuine order recovery, positive operating cash flow, and operating-line profitability before the fundamental picture catches up with the share price.

Positive Factors

Earnings RecoveryThe return to positive net income and an approximately 8.6% net margin shows a meaningful earnings recovery from 2024’s deep loss. If maintained, this provides greater internal capacity to support operations and investment, although broader performance still needs confirmation.

Negative Factors

Persistent Revenue ContractionSeveral consecutive years of revenue decline indicate that the earnings recovery is not yet supported by sustained top-line expansion. Continued contraction can reduce operating leverage, limit reinvestment capacity, and make future profitability more dependent on cost control or non-recurring improvements.

Tongtai Machine & Tool Co., Ltd (4526) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 15.08B
Dividend Yield: 1.74%
Average Volume (3M): 9.67M
Price to Earnings (P/E): -32.4
Beta (1Y): 0.74
Revenue Growth: -11.59%
EPS Growth: -6075.78%
Country: TW
Employees: 686
Sector: General
Sector Strength: 55
Industry: Industrial - Machinery

Tongtai Machine & Tool Co., Ltd Business Overview & Revenue Model

Company Description

Tongtai Machine & Tool Co., Ltd. is a global enterprise specializing in the production and distribution of diverse industrial machinery. Its extensive product portfolio features a comprehensive range of machine tools. These encompass various machinin...

Tongtai Machine & Tool Co., Ltd Financial Statement Overview

Summary

Fundamentals remain weak. Revenue has nearly halved from its 2021 peak to NT$5.36bn, with a further 5.8% decline last year, and the core operating line is still loss-making (EBIT roughly -NT$703m) despite a headline swing to a NT$459m net profit — indicating earnings were driven by non-operating or one-off items. Gross margin did rebound to 15.8% from 8.8%, and equity grew to NT$4.79bn with leverage easing to about 1.06x debt-to-equity, but debt has stayed flat while the business shrank. The most serious issue is cash: operating cash flow swung to about -NT$853m and free cash flow to roughly -NT$1.13bn, the worst in six years, a profit-versus-cash mismatch that signals low earnings quality and raises funding risk on an already leveraged balance sheet.

Income Statement

42Neutral

Balance Sheet

48Neutral

Cash Flow

22Negative

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.18B	5.36B	5.74B	7.62B	8.27B	9.63B
Gross Profit	706.08M	845.59M	502.70M	1.55B	1.82B	1.88B
EBITDA	-176.37M	932.97M	-673.76M	543.09M	648.76M	661.61M
Net Income	-449.46M	459.01M	-906.84M	50.13M	90.95M	172.70M
Balance Sheet
Total Assets	13.78B	12.54B	12.31B	12.65B	14.90B	16.00B
Cash, Cash Equivalents and Short-Term Investments	1.21B	1.30B	1.00B	948.32M	1.42B	1.74B
Total Debt	5.59B	5.06B	5.05B	4.97B	5.78B	6.49B
Total Liabilities	8.70B	7.70B	7.88B	7.55B	9.23B	10.38B
Stockholders Equity	5.01B	4.79B	4.42B	5.09B	5.07B	5.03B
Cash Flow
Free Cash Flow	-1.41B	-1.13B	117.10M	581.24M	633.02M	-20.95M
Operating Cash Flow	-1.20B	-853.36M	236.37M	690.05M	768.60M	132.63M
Investing Cash Flow	-510.34M	1.02B	-215.22M	-414.57M	-176.09M	62.52M
Financing Cash Flow	593.49M	94.19M	-33.71M	-541.23M	-964.36M	-240.43M

Tongtai Machine & Tool Co., Ltd Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:4526 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:4551	67Neutral	TWD 15.15B	14.74	―	2.91%	16.24%	32.38%
TW:5443	60Neutral	TWD 14.48B	28.25	―	2.48%	12.27%	46.93%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:6438	52Neutral	TWD 11.34B	24.48	―	3.57%	18.41%	-25.67%
TW:4526	52Neutral	TWD 15.19B	-32.37	―	1.74%	-11.59%	-6075.78%

* General Sector Average

Performance Comparison

TW:4526 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:4526	Tongtai Machine & Tool Co., Ltd	57.40	25.50	79.95%
TW:4551	Global PMX Co., Ltd.	144.50	29.59	25.75%
TW:5443	Gallant Precision Machining Co., Ltd.	88.60	3.44	4.04%
TW:6438	Symtek Automation Asia Co., Ltd.	140.00	9.14	6.99%
TW:7768	Praise Victor Industrial Co., Ltd.	214.00	54.90	34.51%
TW:7792	AM-Power Machine International Enterprise Co Ltd	289.00	100.50	53.31%

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

Tongtai Machine & Tool Co., Ltd AI Stock Analysis