Forest Water Environmental Engineering Co., Ltd. (8473) AI Stock Analysis

Forest Water Environmental Engineering Co., Ltd.

(TWSE:8473)

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Rating:64Neutral

Price Target:TWD 36.00▲(4.05% Upside)

Action:initiatedcoverage

Date:11/09/26

Forest Water earns a moderately above-average score driven primarily by its improved financial profile: sharply higher revenue and profits, multi-year high margins, excellent cash conversion with free cash flow covering nearly all net income, and a steadily declining debt-to-equity ratio. Valuation reinforces the case, with a single-digit-to-low-double-digit P/E of 10.0 and a 2.31% dividend yield. The main drag is technical: the shares trade below every major moving average with a negative MACD, signalling a sustained downtrend that the market appears to be pricing against the durability of the recent earnings surge. Secondary risks include a historically volatile, project-dependent revenue base, a still-elevated NT$5.58bn debt load, and a sub-7% return on equity.

Positive Factors

Improved ProfitabilityThe 2025 recovery shows materially stronger profitability, supported by higher net, EBIT, and EBITDA margins. If these margins remain durable, the company should retain more revenue as earnings, improve resilience, and generate greater capacity to fund water and wastewater projects.

Negative Factors

Revenue VolatilityThe multi-year pattern of declining revenue before the 2025 rebound shows that growth has not yet been consistently established. Such project-driven volatility can make future earnings less predictable and complicate staffing, investment planning, and sustainable expansion of the business.

Forest Water Environmental Engineering Co., Ltd. (8473) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 6.89B
Dividend Yield: 2.26%
Average Volume (3M): 550.39K
Price to Earnings (P/E): 10.0
Beta (1Y): 0.69
Revenue Growth: 31.21%
EPS Growth: 125.14%
Country: TW
Employees: 157
Sector: General
Sector Strength: 55
Industry: Waste Management

Forest Water Environmental Engineering Co., Ltd. Business Overview & Revenue Model

Company Description

Forest Water Environmental Engineering Co., Ltd., founded in 1993 and headquartered in Taipei City, Taiwan, is actively engaged in the environmental engineering industry throughout Taiwan. The company specializes in the operation and comprehensive ma...

Forest Water Environmental Engineering Co., Ltd. Financial Statement Overview

Summary

A strong recovery year underpins the score. Revenue jumped to NT$5.12bn from NT$3.39bn, net income nearly tripled to NT$462m, and margins hit multi-year highs (23.1% gross, 17.7% operating, 9.0% net). Cash flow is the standout: operating cash flow of NT$1.51bn (29% of revenue) and free cash flow of NT$1.43bn covering 95% of net income confirm earnings are cash-backed. The balance sheet is steadily de-leveraging, with debt-to-equity down to 0.82 from a 2022 peak of 1.16 and equity funding 41% of assets. Offsetting this are a project-driven, historically volatile revenue stream (operating cash flow was negative as recently as 2022), a still-meaningful NT$5.58bn debt load, and a modest 6.8% return on equity that suggests the capital base is not yet working hard enough.

Income Statement

73Positive

Balance Sheet

61Positive

Cash Flow

76Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.37B	5.12B	3.39B	3.68B	3.92B	3.96B
Gross Profit	1.33B	1.18B	751.69M	619.10M	266.53M	895.66M
EBITDA	1.25B	1.11B	757.68M	639.99M	211.03M	834.48M
Net Income	628.86M	461.88M	167.19M	39.75M	-168.88M	337.58M
Balance Sheet
Total Assets	16.72B	16.69B	15.68B	15.44B	15.38B	15.61B
Cash, Cash Equivalents and Short-Term Investments	3.58B	3.91B	3.38B	2.75B	2.30B	2.89B
Total Debt	6.23B	5.58B	5.65B	5.62B	6.17B	6.18B
Total Liabilities	9.24B	8.48B	7.85B	7.98B	8.44B	8.25B
Stockholders Equity	6.96B	6.83B	6.56B	5.79B	5.30B	5.73B
Cash Flow
Free Cash Flow	1.51B	1.43B	442.80M	484.09M	-363.54M	72.04M
Operating Cash Flow	1.55B	1.51B	887.87M	566.68M	-318.39M	96.36M
Investing Cash Flow	-1.18B	-91.72M	-682.00K	-70.31M	-28.27M	167.00M
Financing Cash Flow	228.58M	-347.98M	73.21M	-68.81M	-425.62M	133.76M

Forest Water Environmental Engineering Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:8473 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:1737	67Neutral	TWD 5.98B	15.33	―	4.68%	-2.24%	13.09%
TW:8473	64Neutral	TWD 6.98B	9.97	―	2.26%	31.21%	125.14%
TW:9927	63Neutral	TWD 6.96B	9.50	―	8.62%	17.87%	-9.81%
TW:3402	61Neutral	TWD 8.01B	16.02	―	5.36%	17.22%	2.00%
TW:1713	57Neutral	TWD 6.13B	8.55	―	7.64%	2.77%	-51.96%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:6208	47Neutral	TWD 6.64B	16.54	―	2.84%	1.09%	40.91%

* General Sector Average

Performance Comparison

TW:8473 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:8473	Forest Water Environmental Engineering Co., Ltd.	34.60	1.85	5.66%
TW:1713	Cathay Chemical Works Inc.	40.60	-1.62	-3.83%
TW:1737	Taiyen Biotech Co. Ltd.	29.90	-0.58	-1.90%
TW:3402	Wholetech System Hitech Limited	112.00	-3.48	-3.01%
TW:6208	Highlight Tech Corp.	70.30	27.53	64.37%
TW:9927	Thye Ming Industrial Co.,Ltd	58.00	-6.19	-9.64%

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

Forest Water Environmental Engineering Co., Ltd. AI Stock Analysis