Rafael Microelectronics, Inc. (6568) AI Stock Analysis

Rafael Microelectronics, Inc.

(TPEx:6568)

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Rating:62Neutral

Price Target:TWD 107.00▼(-0.93% Downside)

Action:initiatedcoverage

Date:11/09/26

Rafael Microelectronics earns a moderate score. Its greatest strength is financial resilience: a virtually debt-free balance sheet, a second consecutive year of margin expansion, and a sharp rebound in free cash flow to ~NT$273m with excellent earnings-to-cash conversion. Offsetting this, revenue remains near 2020 levels, margins and return on equity sit well below prior peaks, and both earnings and cash flow have been erratic. The main drag on the score is the technical picture — the stock trades well below all key moving averages with negative MACD, indicating a persistent downtrend, albeit at deeply washed-out momentum readings. A moderate P/E of 20.7 and a ~2% dividend yield provide some support but leave limited valuation cushion while the earnings recovery is still incomplete.

Positive Factors

Conservative Balance SheetMinimal and falling debt gives Rafael Microelectronics substantial financial flexibility and low refinancing risk. A large, steadily growing equity base can support investment, absorb industry volatility, and preserve strategic options without placing significant pressure on future cash flows.

Negative Factors

Cyclical Revenue VolatilityThe large swing from a sharp 2023 revenue decline to rapid growth in 2025 indicates meaningful earnings sensitivity to the semiconductor cycle. Such volatility can make demand planning, utilization, and sustainable profit forecasting less reliable over the next several quarters.

Rafael Microelectronics, Inc. (6568) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 3.36B
Dividend Yield: 1.85%
Average Volume (3M): 111.26K
Price to Earnings (P/E): 20.9
Beta (1Y): 0.98
Revenue Growth: 14.19%
EPS Growth: 67.12%
Country: TW
Employees: 50
Sector: General
Sector Strength: 55
Industry: Semiconductors

Rafael Microelectronics, Inc. Business Overview & Revenue Model

Company Description

Rafael Microelectronics, Inc. focuses on the development, manufacturing, and commercialization of radio frequency (RF) integrated circuits, complete RF systems, and related components, predominantly within Taiwan. The company's extensive product line...

Rafael Microelectronics, Inc. Financial Statement Overview

Summary

A conservative, recovering financial profile. The balance sheet is the standout (score 86): essentially debt-free with equity funding ~86% of assets, giving strong downside protection through semiconductor cycles, though return on equity of ~7.9% shows the capital base is under-utilised. Cash flow (74) rebounded sharply, with operating cash flow more than doubling to ~NT$292m and free cash flow reaching ~NT$273m, backed by high-quality earnings conversion, but history shows pronounced volatility including negative free cash flow years. The income statement (63) is the weakest link: revenue grew ~7% to ~NT$1.14bn with gross margin up to 40.4% and net margin at 10.7%, yet sales are near 2020 levels and margins remain well below the 49-54% gross and 16-17% net margins of the 2020-2021 peak.

Income Statement

63Positive

Balance Sheet

86Very Positive

Cash Flow

74Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.24B	1.14B	1.07B	996.02M	1.30B	1.03B
Gross Profit	477.39M	459.85M	414.14M	336.42M	526.96M	559.14M
EBITDA	204.72M	190.80M	185.03M	106.88M	201.14M	264.98M
Net Income	154.22M	122.01M	117.11M	41.78M	121.65M	166.46M
Balance Sheet
Total Assets	1.84B	1.80B	1.67B	1.59B	1.88B	1.74B
Cash, Cash Equivalents and Short-Term Investments	1.06B	978.05M	765.63M	793.05M	938.89M	958.30M
Total Debt	3.45M	1.09M	2.65M	6.55M	7.03M	9.62M
Total Liabilities	276.42M	248.28M	199.53M	190.55M	386.97M	248.49M
Stockholders Equity	1.57B	1.55B	1.47B	1.40B	1.49B	1.49B
Cash Flow
Free Cash Flow	340.21M	272.59M	25.59M	-21.04M	157.67M	-3.10M
Operating Cash Flow	344.69M	291.80M	131.36M	326.00K	218.49M	86.30M
Investing Cash Flow	-227.68M	-169.46M	-129.09M	-24.35M	-105.83M	-302.92M
Financing Cash Flow	-63.55M	-65.32M	-59.37M	-127.69M	-141.05M	-133.91M

Rafael Microelectronics, Inc. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:6568 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:3257	74Outperform	TWD 3.23B	23.41	―	6.91%	-24.76%	-42.52%
TW:6568	62Neutral	TWD 3.20B	20.86	―	1.85%	14.19%	67.12%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:3094	53Neutral	TWD 3.51B	57.99	―	0.56%	18.10%	175.45%
TW:6485	52Neutral	TWD 2.84B	-201.60	―	0.80%	-2.50%	-307.20%
TW:3041	31Underperform	TWD 2.99B	-6.94	―	―	3.96%	-48.99%

* General Sector Average

Performance Comparison

TW:6568 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:6568	Rafael Microelectronics, Inc.	108.00	6.89	6.81%
TW:3041	ALi Corporation	21.10	-6.10	-22.43%
TW:3094	Davicom Semiconductor, Inc.	44.60	19.67	78.87%
TW:3257	Champion Microelectronic Corp.	40.50	-21.18	-34.34%
TW:6485	ASolid Technology Co Ltd	60.00	-20.72	-25.67%
TW:6775	Entire Technology Co Ltd	28.80	-0.54	-1.82%

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

Rafael Microelectronics, Inc. AI Stock Analysis