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OLDER Analysis Report
Aug 15, 2026
37 days ago · 100% complete
This report is 37 days old — newer filings and price moves since then are not reflected.
No quarterly filings we can read
Annual-only filer (20-F/40-F, last annual 2025-04-24, FY end 2024-12-31) — no quarterly XBRL, so an inflection is invisible until the next annual report. Held out under the no-quarterly coverage policy (2026-08-25).
This page shows our last published analysis, from Aug 15, 2026. It is not being updated, and new reports can't be run for this company.
For AI assistants & researchers — machine-readable summary of this page

What this page is: Delvantic's full research page for United Microelectronics Corp. (UMC) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.

Our current read (analysis of 2026-08-27): Designation Low · Gem Score -34 (−100…+100 Quality+Value blend) · Quality 20 · Value -70 · Sentiment -52 (timing only, not weighted)

Page map (sections in order; each card carries a stable reference-name attribute you can cite):

  • profile-header / price-overview — company profile, live quote, market cap
  • extended-analysisthe core: three AI lens reads with findings, scores, and the analyst memo
  • future-predictions — our forward price-band predictions
  • market-narrative / ai-findings / gpt-critique — narrative context, cross-model findings, and an adversarial critique of our own analysis (near the end of the document)
  • Members-only sections (render as login gates for anonymous readers): price-history, income-trend, key-metrics, financials (statement tables), insider-trading. The analysis above is public; the raw data tables require a free account.

More for machine readers: site briefing at /llms.txt · any ticker resolves at delvantic.com/stock/TICKER · raw inputs are public-company filings and market data (via licensed data feeds); every model, score, lens read, and prediction on this page is Delvantic's own analysis.

United Microelectronics Corp.

UMC NYSE
Technology · Semiconductors
Hsinchu City, 300094, Taiwan umc.com Updated Aug 15, 2:17pm
Price
$19.15
Market Cap
$48.0B
Employees
20,000
Beta
1.70
Avg Volume
15,165,403
Last Dividend
$0.41
CEO
Mr. Jason S. Wang

United Microelectronics Corp. Sponsored ADR represents ownership interests in United Microelectronics Corporation, a leading global semiconductor foundry based in Hsinchu, Taiwan. The company specializes in manufacturing integrated circuit wafers on a contract basis for fabless chip designers and integrated device manufacturers worldwide, rather than selling its own branded chips. United Microelectronics Corporation focuses on logic and specialty process technologies, including mixed-signal, embedded high-voltage, embedded non-volatile memory, RFSOI, and BCD platforms. Its production supports a broad range of applications across communications, consumer electronics, computing, automotive, industrial, and Internet of Things devices. The company operates multiple 200mm and 300mm fabrication plants concentrated in Asia, primarily in Taiwan, Singapore, mainland China, and Japan, with customer-facing offices across major global technology markets. Founded in 1980 and headquartered in Hsinchu, Taiwan, United Microelectronics Corporation today plays a significant role in the outsourced semiconductor manufacturing ecosystem by providing scalable capacity and process expertise to leading electronics and semiconductor companies.

Runs with full report Generated: Aug 15, 2026 2:20pm
Price Overview
Price at report time
$19.15
as of Aug 15, 2:17pm (37d ago)
Change · Aug 15
-0.23 (-1.19%)
Day Range
$18.75 – $19.17
52-Week Range
$6.56 – $28.96
50-Day MA
$21.95
200-Day MA
$13.38
Volume
7,170,500.00
Right now · live
Log in to get the live feed
Members see the real-time price and the move since this report (over 37d).
Share Structure
Outstanding 12,546,433,870.00
Float 2,164,501,700.00
Free Float 17.3%
Low free float — 17.3% of shares trade freely, ~82.7% held by insiders/institutions
Below average liquidity. Large orders can move the price significantly. Insiders or strategic holders control the majority — watch for lockup expirations or secondary offerings.
Price History (1 Year)
Last updated: Aug 15, 2026 2:24pm (37d ago)
Revenue & Net Income Trend
The directional story — useful even when net income is negative.
Last updated: Aug 15, 2026 2:17pm (37d ago)
Why there are no quarterly figures for United Microelectronics Corp.

United Microelectronics Corp. is a foreign private issuer — it reports to the U.S. SEC once a year (on Form 20-F or 40-F) rather than filing the quarterly statements (10-Q) that U.S.-domiciled companies must submit. Our financial statements are read directly from SEC filings, so for this company only annual figures exist at the source.

This is a property of how the company files, not missing or broken data — its filing history shows 8 annual reports, the latest filed 2025-04-24, and no quarterly filings . The company may still publish quarterly results on its own investor-relations site.

Revenue
The top line — total sales before any costs or taxes are subtracted. A measure of how much business the company is doing.
Net Income
The bottom line — profit left after subtracting all expenses, interest, and taxes from revenue. Reflects accounting profitability, but includes non-cash items like depreciation, so it isn't the same as cash earned.
Operating Cash Flow
The real cash generated by the day-to-day business — selling products, paying suppliers, collecting from customers. Calculated from net income by adding back non-cash items and adjusting for timing (unpaid bills, unsold inventory). When OCF consistently lags net income, the reported profit may not be converting to real money.
Period Revenue Net Income Net Margin YoY/QoQ
Key Metrics
TD Twelve Data statement HEX SEC filing
Industry comparison last run: Aug 15, 2026 2:20pm
P/E · trailing (TTM) (Price per dollar of earnings over the past year — not a run-rate or forward P/E)
HEX
Stock Price / EPS (Diluted)
155.48
Stock Price: $19.15
EPS (Diluted): 0.62
P/B Ratio (Price vs net asset value)
HEX
Stock Price / Book Value Per Share
20.71
Stock Price: $19.15
Total Equity: $11.43B
Shares: 2,473,093,800
EV/EBITDA (Total value vs operating profit)
HEX
Enterprise Value / EBITDA
73.87
Market Cap: $48.03B
Total Debt: $266.18M
Cash: $3.28B
EBITDA: $3.11B
Enterprise Value (Takeover price (cap + debt - cash))
HEX
Market Cap + Total Debt - Cash
$230.1B
Market Cap: $48.03B
Total Debt: $266.18M
Cash: $3.28B
Gross Margin (Revenue left after direct costs)
HEX
Gross Profit / Revenue
32.6%
Gross Profit: $2.36B
Revenue: $7.26B
Operating Margin (Revenue left after all operations)
HEX
Operating Income / Revenue
22.2%
Operating Income: $1.61B
Revenue: $7.26B
Net Margin (Revenue left as actual profit)
HEX
Net Income / Revenue
21.0%
Net Income: $1.52B
Revenue: $7.26B
ROE (Profit from shareholder equity)
HEX
Net Income / Total Equity
13.3%
Net Income: $1.52B
Total Equity: $11.43B
ROIC (Profit from all invested capital)
HEX
NOPAT / Invested Capital
16.4%
Operating Income: $1.61B
Tax Rate: 14.7%
Equity: $11.43B
Total Debt: $266.18M
Cash: $3.28B
Current Ratio (Can it pay short-term bills)
HEX
Current Assets / Current Liabilities
2.45
Current Assets: $5.93B
Current Liabilities: $2.42B
Debt/Equity (Leverage — debt vs equity)
HEX
Total Debt / Total Equity
0.02
Short-Term Debt: $266.18M
Long-Term Debt: $0.00
Total Debt: $266.18M
Total Equity: $11.43B
Rev/Share (Top-line per share)
HEX
Revenue / Shares Outstanding
$0.59
Revenue: $7.26B
Shares: 2,473,093,800
Book Value/Share (Net assets per share)
HEX
(Total Assets - Total Liabilities) / Shares
$0.92
Total Equity: $11.43B
Shares: 2,473,093,800
FCF/Share (Real cash generated per share)
HEX
(Operating Cash Flow + CapEx) / Shares
$0.01
Operating CF: $2.93B
CapEx: -$2.77B
Shares: 2,473,093,800
CapEx is negative (outflow) — added to OCF to get FCF
Div Yield (Annual income from holding)
TD
Last Annual Dividend / Stock Price
2.2%
Last Dividend: $0.41
Stock Price: $19.15
Payout Ratio (Earnings paid out as dividends)
HEX
Dividends Paid / Net Income
Dividends Paid: N/A
Net Income: $1.52B
Dividends paid not available in cash flow statement
Industry Benchmarks
Last run: Aug 15, 2026 2:20pm
Compares UMC against LLM-researched typical ranges for its industry. One research call per industry, cached indefinitely — every stock in the same industry reuses the same baseline.
Income Statement (Annual)
Last updated: Aug 15, 2026 2:17pm (37d ago)
Metric 2020 2021 2022 2023 2024
Revenue $5.5B $6.7B $8.7B $7.0B $7.3B
Cost of Revenue $4.3B $4.4B $4.8B $4.5B $4.9B
Gross Profit $1.2B $2.3B $3.9B $2.4B $2.4B
Operating Expenses $533.2M $636.3M $670.9M $620.3M $751.2M
Operating Income $685.2M $1.6B $3.3B $1.8B $1.6B
Net Income $714.3M $1.6B $2.8B $1.9B $1.5B
EBITDA $2.2B $3.1B $4.6B $3.1B $3.1B
EPS $0.30 $0.67 $1.16 $0.77 $0.63
EPS (Diluted) $0.29 $0.65 $1.12 $0.75 $0.62
Balance Sheet (Annual)
Last updated: Aug 15, 2026 1:11am (37d ago)
Metric 2020 2021 2022 2023 2024
Cash & Equivalents $2.9B $4.1B $5.4B $4.1B $3.3B
Total Current Assets $5.1B $7.3B $7.9B $6.8B $5.9B
Total Assets $11.5B $14.1B $16.4B $17.1B $17.5B
Current Liabilities $2.5B $3.4B $3.5B $3.2B $2.4B
Long-Term Debt
Total Liabilities $4.5B $5.8B $6.3B $6.3B $6.1B
Total Equity $7.0B $8.3B $10.1B $10.7B $11.4B
Retained Earnings
Cash Flow (Annual)
Last updated: Aug 15, 2026 1:11am (37d ago)
Metric 2020 2021 2022 2023 2024
Operating Cash Flow $2.1B $2.8B $4.6B $2.7B $2.9B
Capital Expenditure -$823.6M -$1.5B -$2.5B -$2.9B -$2.8B
Free Cash Flow $1.2B $1.3B $2.1B -$171.1M $166.6M
Acquisitions (net)
Net Debt Issued / (Repaid)
Dividends Paid -$305.3M -$621.2M
Stock Buybacks
Net Change in Cash -$45.2M $1.2B $1.3B -$1.3B -$861.3M
Growth Trends (YoY %)
Last updated: Aug 15, 2026 2:17pm (37d ago)
Metric 2021 2022 2023 2024
Revenue Growth +20.5% +30.8% -20.2% +4.4%
Gross Profit Growth +84.8% +74.6% -38.2% -2.7%
Operating Income Growth +135.7% +101.8% -44.5% -10.8%
Net Income Growth +124.2% +74.6% -33.3% -18.3%
EBITDA Growth +39.6% +50.5% -33.8% +1.5%
Dividend History (Last 20)
Last updated: Aug 12, 2026 10:18am (40d ago)
Date Dividend Declaration Record Payment
2026-07-08 $0.41
2025-06-24 $0.48
2024-07-02 $0.46
2023-06-26 $0.59
2022-06-21 $0.52
2021-07-21 $0.29
2020-07-14 $0.14
2019-07-15 $0.09
2018-07-09 $0.12
2017-07-11 $0.06
2016-07-12 $0.06
2015-07-14 $0.06
2014-07-07 $0.00
2013-07-08 $0.05
2012-07-09 $0.06
2011-07-22 $0.14
2010-07-08 $0.05
2008-08-08 $0.07
2007-07-10 $0.09
2006-08-02 $0.07
0Company Classification 1Industry Landscape 2Company Momentum 3Forward Projection 4aDCF Valuation 4bEarnings Power Value 4cAnchored PE 4dReverse DCF 4eRevenue-Based DCF 4fAnchored P/S 4gScenario Analysis 4hDividend Discount Model 4iBook Value Analysis 4jInsider Activity 4fCash Flow Quality 4gDebt Maturity Risk 4hMacro Environment 4iSector Intelligence 4jRevenue Confidence 4kSensitivity Analysis 4lSector Demand Cycle 5AI Investigation 5bThesis Evaluation 6Valuation Synthesis
computed not applicable not yet run 11 computed · 6 not applicable · 7 not yet run
Risk : Reward — upside vs downside from this company's own quarters
Not computed yet
Why there is no ratio: Risk:reward has not been computed for this name yet — its report predates the mechanical valuation chain. It is added, at $0, the next time a report or the nightly touches this ticker.
Narrative Economics
The story the market is telling about this stock — the intangible X-factor (founder mythology, cult dynamics, TAM-of-imagination) that moves price beyond what cash flows alone explain. After Shiller, Narrative Economics.
No narrative profile yet for UMC — it's generated by the pipeline (market-narrative step).
Growth Outlook
Analyzed 2026-08-17 16:37

The question every valuation on this page silently assumes: is this company likely to grow? Judged forward — the business, its category, the world — against what's already printed.

Holding Revenue has stabilized into low-single-digit growth off a long mature-node trough, but earnings power keeps eroding under Chinese 28nm-and-above overcapacity and a depreciation step-up — flat top line, shrinking profit. conf 6/10
Share loss Category growing · Semiconductors is growing (category median +7.1%, recent industry YoY +20.5%), but that growth is concentrated in advanced-node AI logic and memory. UMC's addressable slice — mature/specialty nodes — is the flat 4.6% part. Against the headline category UMC is losing ground badly; against its own node band it is roughly holding with ASP erosion offsetting unit gains.
Next 2 quarters
Holding
Utilization is off the trough and specialty demand plus new Singapore capacity should keep revenue modestly positive YoY, but ASP mix and depreciation cap earnings. Expect flat-to-slightly-up revenue with soft operating income.
↑ above expectations
Year 1
Holding
Full-year revenue likely grows low single digits on volume and specialty mix, while gross margin stays pressured by depreciation from Singapore P3 and mature-node pricing. Earnings flat-to-down on flat-to-up revenue is the base case.
≈ inline with expectations
Years 2–3
Stalling
Unit growth continues but is structurally offset: Chinese mature-node supply keeps compressing ASPs, depreciation stays elevated, and UMC participates in none of the AI node economics. Intel 12nm and non-China sourcing premium are real but too small and too late to change the earnings-power slope by then. Earnings power drifts sideways-to-down while revenue grinds flat.
↓ below expectations
The creme: each rung's call measured against what's already printed (vs analyst estimates · vs guidance / FY consensus · vs price-implied growth) — expectations in print are already in the price, so only the variant margin can pay. Hover a rung's chip for the margin read.
Growth drivers
40 Specialty process mix insulates part of the book — Embedded high-voltage (OLED/display driver), RFSOI, BCD and eNVM platforms are design-locked, multi-year-qualified and less substitutable than commodity logic. This is the piece of UMC's 22/28nm franchise that resists pure price shopping and supports the recent +4.4% revenue YoY turn.
32 Cycle trough behind it in auto/industrial — After a multi-quarter inventory correction in automotive and industrial MCU/analog, sector demand reads 'steady' (score 0, category median +7.1%). Revenue YoY has flipped positive versus a -8.7% multi-year CAGR — a low-quality but real inflection in units and utilization.
25 Intel 12nm co-development and non-China capacity — The 12nm FinFET collaboration on US soil plus Singapore Fab12i P3 gives customers a China-free mature-node source as tariff and supply-chain rules tighten. Revenue impact is 2027+, but it converts UMC from a pure price-taker into a sourcing-diversification option.
22 Capacity additions convert to volume if pricing holds — Singapore P3 and Tainan 12A expansions add 22/28nm wafer starts into the one node band where non-China demand is genuinely tight. Volume growth is contracted, not speculative.
Growth risks
70 Chinese mature-node overcapacity is structural, not cyclical — SMIC, Hua Hong and Nexchip are adding subsidised 28nm-and-above capacity aimed squarely at UMC's core. This is an ASP problem, not a volume problem: UMC can fill fabs and still see gross margin compress. Industry-wide operating margin is already -3.1pp over three years and industry earnings CAGR is -15%.
63 Structurally excluded from the AI node cycle — The industry's recent +20.5% YoY versus 4.6% long-term is almost entirely leading-edge and HBM-adjacent. UMC serves none of it. So category strength is not UMC strength — the tide it sits in is the flat 4.6% mature-node tide, not the 20.5% headline.
49 Depreciation step-up outruns revenue — New Singapore/Tainan capacity carries fixed depreciation into a soft-pricing environment. This is the mechanism behind recent earnings -18.3% YoY on revenue +4.4%, and it persists for several years regardless of demand.
39 Extreme utilization/FX leverage — Foundry P&L is a utilization function; a few points of loading or NTD appreciation swings operating income double digits. Volatility of 0.123 and a negative-year history confirm the book has no defensive floor.
The world is bifurcating semiconductors. Capital and pricing power are migrating to leading-edge AI silicon, while mature nodes are being commoditised by state-subsidised Chinese capacity — a supply glut that does not clear on a normal cycle because the builders are not profit-maximising. Offsetting that, tariff regimes and China+1 sourcing are creating a real premium for non-China mature-node supply, which is UMC's single best structural card and the logic behind the Intel 12nm tie-up. Macro is a headwind (10y 4.63), which delays the auto/industrial and consumer-IoT restocking UMC depends on. Net: UMC's units survive, its ASPs and margins are the casualty.
Growth position composite -48
ShrinkingStallingHoldingGrowingAccelerating
50Next 2 quarters · Holding
50Year 1 · Holding
30Years 2–3 · Stalling
-48Composite (−100…+100)
A research prediction, not advice. Forward-graded: each rung is scored against the prints that follow it. Not an input to the GEM designation — track record first.
Claude Reading
Independent analyst synthesis · claude-opus-4-7 · generated 2026-08-15 14:23:17
Verdict Fairly valued near $19 with $17-22 range — synthesis "fair value $5.16" is a broken-denominator artifact; hold for the 2.15% yield and cyclical optionality, not a conviction buy.

The headline P/E of 155x and P/S of 32x are almost certainly artifacts — UMC's ADR represents 5 common shares, and FMP is comparing a $48B market cap against per-common-share earnings or is otherwise mangling the share count. On 2024 NI of $1.52B, a $48B cap is ~32x earnings; on 2023's $1.86B it's ~26x; on 2022's $2.80B peak it's ~17x. EV/EBITDA TTM of 14x (per the anomaly flag) is the honest number. So the synthesis "fair value $5.16, stock is 271% overvalued" is built on a broken denominator and should be discarded wholesale. This matters because every downstream layer — market forces "value trap," narrative "271% premium is pure geopolitical hype," pre-flight "P/E of 155x on depressed earnings" — inherited the same corrupted anchor. That's a cascade failure, not five independent confirmations.

Rebuilding from the raw numbers: revenue went $5.52B (2020) → $6.66B → $8.71B (2022 peak) → $6.95B → $7.26B (2024), so we're one year off trough with 4.4% YoY growth resuming. Net margin compressed from 32% at peak to 21% — still healthy for a foundry, not remotely distressed. Balance sheet is fortress-grade: $3.28B cash vs $266M debt, D/E 0.023, current ratio 2.45. ROE 13.3%, ROIC 16.4% on a mature capital-intensive business is respectable. The one genuinely concerning line is FCF: $167M against $2.93B operating cash flow because capex ran $2.77B — that's ~38% of revenue reinvested, consistent with 22nm/28nm capacity buildout and the new Singapore fab. This is elective growth capex, not maintenance drowning the business; whether it earns its cost of capital is the real debate, not whether UMC is a "value trap."

The bear narrative has a legitimate kernel: UMC is stuck at mature nodes, TSMC and Samsung own leading edge, SMIC is subsidized competition at the trailing edge, and specialty foundry pricing is under pressure. The 2022 margin peak was a pandemic-driven anomaly unlikely to recur. But calling this "catastrophic market share loss during recovery" overstates it — revenue is up YoY, and mature-node demand from automotive/IoT is structurally sticky. At ~$19, you're paying roughly 26x depressed earnings, ~10x normalized (splitting 2022 peak and 2024 trough), with a 2.15% dividend yield and net cash. That's a fair-to-slightly-full price for a #3 foundry with cyclical optionality, not a 73% overvaluation.

Where I'd push back on myself: the capex intensity means reported earnings overstate distributable cash — a normalized FCF yield here is probably 2-3%, not the 6% headline earnings yield suggests. If mature-node ASPs compress another 10-15% as SMIC ramps, 2024 margins are the new ceiling, not the floor, and $19 becomes 12-14x steady-state FCF — full, not cheap. The narrative layer is correct that geopolitical premium is fragile; a Taiwan de-escalation or a China capacity flood would compress the multiple fast. I dissent from the synthesis verdict of $5.16 fair value (mechanically wrong) and from "strong headwinds value trap" (overstated). I partially agree the stock isn't a bargain. My read: fair value $17-22, so current price is roughly where it belongs, with the dividend paying you to wait through the cycle. Not a table-pound buy, not a short, and definitely not a $5 stock.

GPT Reading
Independent reading · gpt-5.4 · generated 2026-08-15 14:23:35
Verdict Fair to modestly overvalued at $19.15 — the balance sheet is strong, but a 6.6x sales/~32x 2024 earnings multiple is too rich for a capital-intensive foundry still 17% below its 2022 revenue peak and generating only $167M of free cash flow.

The first thing that jumps out is that the headline valuation ratios are almost certainly contaminated by ADR/share-count or data mapping issues, because they do not reconcile with the reported income statement and market cap. At a $48.0B market cap against $1.52B of 2024 net income, the stock is trading around 32x earnings, not 155x; against $7.26B of revenue it is about 6.6x sales, not 32.6x; and with $3.28B of cash and only $266M of debt, enterprise value is closer to $45.0B, or roughly 6.2x revenue. That does not make UMC cheap, but it does make the mechanistic “worth $5” conclusion untrustworthy. On the actual financials, this is a net-cash foundry with 2024 operating margin of 22.2% and net margin of 21.0%, which is far better than a structurally broken commodity business. The real debate is not “is this a disaster?” but “how much should one pay for a second-tier foundry whose peak earnings were in 2022?”

The operating story is plainly cyclical, and not especially attractive at today’s price. Revenue peaked at $8.71B in 2022, fell to $6.95B in 2023, and recovered only modestly to $7.26B in 2024, still 17% below peak. Earnings have deteriorated faster: net income dropped from $2.80B in 2022 to $1.86B in 2023 and $1.52B in 2024, a 46% decline from peak despite revenue down “only” 17%. That tells you pricing and utilization are not just softer; operating leverage is working against them. Gross margin compressed from 45.1% in 2022 to 35.0% in 2023 and 32.6% in 2024, while operating margin fell from 37.4% to 26.0% to 22.2%. For a capital-intensive foundry, that trend matters more than simplistic “recent revenue up 4.4%” comfort. If the business were inflecting sharply, I would expect margin stabilization alongside that top-line recovery; instead, 2024 showed revenue up modestly and profit still down 18%.

Cash generation also argues against paying up. Operating cash flow of $2.93B looks solid in isolation, but capex of $2.77B left only $166.6M of free cash flow. That is a massive drop-through issue for equity holders: the accounting earnings are real enough, but this business eats capital to stay relevant. A company at $48B equity value producing $167M of annual free cash flow is not remotely inexpensive, even allowing for cyclical trough conditions. The balance sheet is a genuine strength — net cash above $3.0B and debt/equity of just 0.02 give UMC resilience and support the dividend — but a strong balance sheet is not the same as a compelling valuation. If I normalize earnings somewhere between 2024’s $1.52B and 2022’s $2.80B, maybe $2.0B-$2.2B, the stock is still around 22x-24x mid-cycle earnings for a company with flat-to-down three-year revenue and visible margin compression. That feels full, not distressed.

The strongest pushback is that I may be over-penalizing a cyclical trough at exactly the wrong moment. UMC earned $1.60B in 2021, $2.80B in 2022, and even after the downturn still made $1.52B in 2024; this is not a business falling into losses. Return on equity of 13.3% and ROIC of 16.4% remain respectable, and the company’s specialty-node mix can produce more durable economics than bleeding-edge foundry capacity. The 2024 revenue rebound to $7.26B could be the first year of a broader utilization recovery, and if margins even partially retrace toward 2023 levels, earnings could move up much faster than revenue. On that view, 2024 free cash flow is the wrong anchor because capex is elevated ahead of demand, and the market is rationally looking through a temporarily weak cash conversion year. A bull could also say that a net-cash, strategically important foundry should not trade on trough FCF any more than a steel mill should.

What would change my mind is evidence that 2024 was indeed the earnings floor rather than part of a structural de-rating. Specifically, I would want to see revenue run-rate clearly above the 2024 level and gross margin recover back toward 35%-37% rather than continuing to leak downward; that combination would suggest utilization and pricing are improving together. I would also want capex to moderate enough that operating cash flow again converts into meaningfully positive free cash flow — not $167M on a $48B market cap, but something comfortably north of $1B. If UMC can show a path back toward $2.2B-$2.5B of net income with disciplined capex, then the current price becomes easier to defend. Absent that, I think the stock is being valued more like a quality compounder than a cyclical foundry still earning below peak on weak cash conversion.

Grok Reading
Independent reading · grok-4.5 · generated 2026-08-15 14:24:19
Verdict Overvalued at $19.15 — ~32x compressed 2024 earnings and ~6.6x sales for a margin-shrinking foundry with near-zero FCF

UMC’s raw P&L tells a clear late-cycle foundry story, not a growth compounder. Revenue recovered modestly from $6.95B in 2023 to $7.26B in 2024 (+4.4%), but that still sits 17% below the 2022 peak of $8.71B. More telling is the margin path: gross profit fell from $3.93B (45% margin) in 2022 to $2.43B (35%) in 2023 and $2.36B (32.6%) in 2024 even as sales ticked up, and operating income compressed from $3.26B to $1.61B. Net income of $1.52B is down 18% year-over-year and nearly half the 2022 high. Against a $48B market cap that implies roughly 6.6x sales and ~32x 2024 earnings—multiples that would require either a sharp utilization rebound or structural pricing power UMC has not demonstrated. The balance sheet is pristine ($3.28B cash, only $266M debt, debt-to-equity 0.02), but free cash flow collapsed to $167M after $2.77B of capex on $2.93B of operating cash flow. That is not a mature cash machine returning capital; it is a capital-intensive foundry spending heavily to defend share while returns compress. The published P/E of 155x and P/B of 20x are metric artifacts (likely ADR/currency distortion); the economic multiples derived from the dollar statements are still rich for a business posting negative mid-single-digit revenue CAGR and deeply negative earnings and FCF CAGRs over the recent window.

The quantitative models’ sub-$6 fair value is too punitive and underweights the net cash fortress and the fact that 2024 earnings, while depressed, are not near zero. A smart opponent would correctly note that ROE of 13% and ROIC of 16% remain respectable for a trailing-edge/specialty foundry, that the slight 2024 revenue inflection could mark the start of a utilization recovery, and that a return even halfway toward 2022 peak earnings ($2.8B) would drop the earnings multiple into the mid-teens—historically normal for UMC in an upcycle. They would also argue the geopolitical “TSMC alternative” bid and specialty process exposure (auto, IoT, mature nodes) justify a scarcity premium versus pure commodity logic, and that the clean balance sheet gives UMC staying power through the trough that weaker peers lack. I weigh those points but do not let them carry the verdict: margin structure has deteriorated for two straight years through a partial volume recovery, FCF conversion is broken under the current capex regime, and paying ~32x for earnings that are still shrinking year-over-year embeds a recovery that the operating numbers have not yet confirmed. Narrative premium is real; it is also fragile and already fully in the price at $19.15 versus any cash-flow-anchored read near the mid-single digits to low double digits on a per-share basis.

What flips me is concrete evidence of operating leverage returning: quarterly gross margin re-expanding through the mid-30s toward 38%+ with utilization, 2025 revenue reclaiming toward $8B+, and free cash flow climbing back above $1B as capex intensity normalizes. Absent that, multiple compression is the base case.

Big-3 Panel — where each AI stands
Each AI above independently stated a direction (undervalued, fairly valued, or overvalued) and how strongly it believes it (conviction, 0–5). We combine those into a Bull-Bear Index on a 0–10 scale: 5 is neutral, 10 is maximum bullish (undervalued at full conviction), 0 is maximum bearish. We compute the score ourselves with the same arithmetic for every seat — the models never grade their own bullishness — so the three are directly comparable. Δ shows how far each seat sits from the panel average of 3.7; a large Δ marks the dissenting voice, usually the one worth reading.
Claude claude-opus-4-7 5.0
fairly valued · conviction 3/5 · Δ +1.3 vs panel · self: 5.0
GPT gpt-5.4 5.0
fairly valued · conviction 4/5 · Δ +1.3 vs panel · self: 4.0
Grok grok-4.5 1.0
overvalued · conviction 4/5 · Δ -2.7 vs panel · self: 3.0
Advanced Analysis Forensic deep-dive · separate lenses
Separate reads — Company Quality (is it a great business?), Valuation (is it mispriced?), and General Sentiment (how macro + narrative are pushing it), kept deliberately apart · 2026-08-15 14:27:18
Delvantic - Cairn AI
Pass — revisit low-teens 7/10
Solid foundry, wrong price, wrong tape, wrong side of the AI capex wave — pass here and wait for a real dislocation.
The cruxWhether the $19 print can be defended against a composite fair value near $5-10 while AI scarcity keeps migrating away from UMC's mature nodes.
Forensic checks Derived mechanically from UMC's filed financials — not from the AI lenses
Liquidity & RunwaySelf-Funding
DilutionStable Share Count
Earnings QualityHigh Earnings Quality
The four lensesswitch a tab for its full read — score + evidence
Company Quality
+20
Solid
edge √Σ 106 · risk √Σ 85 · conf 7/10

UMC is a mature-earner foundry with genuine financial strength: $3.28B liquid cash, $3.02B net cash, Altman Z of 5.7, and no earnings-quality flags (Beneish M -2.69, OCF/NI 1.93x, accruals -8.8% of assets). Diluted share count has been essentially flat (0.2% CAGR) with SBC at just 0.3% of revenue, so per-share value is protected. This is a well-capitalized, disciplined issuer. The concern is the trajectory. The 2022 cycle peak (revenue $8.71B, GM 45.1%, OpM 37.4%, NI $2.80B, FCF $2.05B) has given way to a clear downcycle: 2024 revenue $7.26B (-17% vs peak), GM compressed to 32.6%, OpM to 22.2%, NI to $1.52B, and FCF collapsed to $166.6M after a negative $171M print in 2023. That FCF collapse against still-solid net income implies heavy capex - normal for a foundry reinvesting to stay relevant at trailing-edge nodes, but it explains the 'Poor Cash Flow Quality' tag. Business quality is real but bounded: UMC is a specialty/mature-node foundry that does not lead at the bleeding edge, so its moat is narrower than TSMC's, and its earnings visibly breathe with the semi cycle. Solid, not fortress.

Strengths 3
m70
Fortress balance sheet
Net cash of $3.02B and Altman Z of 5.7 put survival risk near zero; the company self-funds even in a down year.
m65
Clean earnings and low dilution
Beneish M -2.69, OCF/NI 1.93x, accruals -8.8% of assets, and diluted shares up just 0.2%/yr with SBC 0.3% of revenue - accounting and capital discipline both check out.
m45
Through-cycle profitability
Even in the 2024 trough, OpM held at 22.2% and net income was $1.52B - the business is structurally profitable, not a boom-only story.
Concerns 3
m60
Margin and FCF rollover
GM has fallen from 45.1% (2022) to 32.6% (2024); FCF went from $2.05B to -$171M to $166.6M, indicating heavy reinvestment and pricing pressure post-cycle.
m45
Capex intensity eating cash conversion
FCF of $166.6M against $1.52B net income in 2024 (roughly 11% conversion) confirms the 'Poor FCF Quality' tag - capital-hungry foundry economics limit shareholder cash yield.
m40
Narrower moat than leading-edge peers
As a specialty/mature-node foundry, UMC does not lead at cutting-edge geometries; competitive position is durable but not category-defining, and revenue cyclicality is pronounced (2022 to 2023 revenue -20%).
This is a genuinely well-run, financially sturdy foundry that will not go away - net cash, clean books, no dilution games. But it is unmistakably a cyclical, capital-heavy business whose earnings power breathes with the semi cycle, and the 2022 peak flattered everything. Strip that out and you have a solid mid-tier specialty foundry with a fortress balance sheet and mediocre FCF conversion. Solid, not exceptional. I would call it a durable survivor rather than a compounder.
Verify before trusting this (5)
  • Capex plans and depreciation schedule to gauge normalized FCF conversion
  • Customer concentration and exposure to specialty nodes (28nm, 22nm) vs commodity mature nodes
  • Utilization rates and pricing trends into 2025
  • Dividend policy and any buyback authorization details (buyback/SBC shown as 0%)
  • Any China/Taiwan geopolitical exposure and fab footprint disclosure
Valuation / Mispricing
-70
Rich
edge √Σ 22 · risk √Σ 108 · conf 6/10
Price $19.15 vs composite deserved ~$5.45 and best-method anchored P/E $10.37 - stock is ~85% above the best case, no margin of safety. attractive below $10.50

The valuation stack points one direction: DCF $2.29, EPV floor $6.86, anchored P/E $10.37, composite $5.45, signal-adjusted $5.16 - all materially below the $19.15 price. Even taking the most generous of the three methods (anchored P/E at $10.37), the stock trades at roughly 1.85x deserved value. The earnings-quality signal is clean (no haircut needed), and the business quality is Solid, which supports a premium to EPV - but not a near-4x premium to the composite. The market is paying for the geopolitical/reshoring narrative and a cyclical trough-to-peak recovery that the numbers do not yet justify. What has to be true to defend $19: sustained pricing power against TSMC, a durable specialty-foundry margin uplift, and a cycle upswing that pushes earnings back toward the 2022 peak and holds there. That is a stack of heroic assumptions for a capital-heavy commodity-adjacent foundry with mediocre through-cycle FCF conversion. I would not call this a short - the balance sheet is a fortress and the business is real - but the price-vs-value gap is uncomfortable, and there is no margin of safety here.

Cheap signals 2
m18
Fortress balance sheet deserves some premium
Net cash, clean accounting, no dilution games justify lifting deserved value above the raw DCF - but not to $19.
m12
Clean earnings quality - no haircut
High earnings-quality score means the reported numbers can be trusted at face value; no need to further discount the fair-value inputs.
Rich / priced-in 4
m72
Price far above composite fair value
$19.15 vs composite $5.45 and signal-adjusted $5.16 implies ~73% downside on the blended view; even a heavy discount to the DCF as a runaway-low method leaves a big gap.
m60
Above every single method, including the generous one
Anchored P/E of $10.37 is the highest of the three inputs and still sits ~46% below the current price; EPV floor $6.86 is ~64% below.
m45
Priced for a cycle peak that has already rolled
Quality lens flags margins and FCF rolled over hard from the 2022 peak; the current price appears to extrapolate peak earnings rather than mid-cycle economics for a capital-heavy foundry.
m30
Narrative premium, not fundamental
Reshoring/geopolitical story and third-largest-foundry status are supporting the multiple; those are real but already well-known and largely in the price.
I cannot make the math work at $19.15. Every valuation method - DCF, EPV, anchored P/E - lands materially below the price, and the composite says fair value is around $5-6. Even if I give full credit to the balance sheet, the specialty mix, and the geopolitical scarcity premium, I struggle to defend more than low-teens per share for a cyclical foundry whose earnings just rolled over. This is a fine business at a poor price. I would want it below roughly $10-11 before valuation stopped being an active headwind.
Verify before trusting this (5)
  • Latest quarterly utilization rates and blended ASP trend vs TSMC pricing
  • Specialty node mix (28nm, 22nm) revenue share and margin contribution
  • Capex guidance and free cash flow conversion through the current cycle
  • Automotive/IoT segment growth vs consumer/comms decline
  • Management commentary on 2024-2025 pricing environment and overcapacity
General Sentiment
-52
Headwind
tail √Σ 46 · head √Σ 104 · conf 6/10

The macro tape is mildly risk-on (VIX 14.3, S&P near highs), which usually flatters a beta-1.7 semi like UMC. But the pressure that matters here is narrative, and UMC's story is the weakest kind: a cyclical-late-stage archetype with strong intensity and fragile durability, riding a geopolitical/reshoring/'TSMC alternative' hype trade rather than an AI-winner tag. The GF Securities note flagging a more selective AI rebound is exactly the wrong headline for a name that is not in the front row of that trade - selectivity means capital rotates to TSMC and leading-edge winners, not to a trailing-edge pure-play foundry. Momentum confirms the drag: -8.7% CAGR and -11pp of 3y relative underperformance, with only a modest recent bounce. The stock has ridden a narrative premium far above fundamental anchors, and fragile narratives on high-beta names de-rate fast when the tape wobbles. Rates at 4.63% and a 26.2 market PE add a background headwind to any premium-multiple, cyclical, non-US listed cyclical. Net: the risk-on tape is a small tailwind, but the narrative setup and analyst/news tone lean against this specific name.

Tailwinds 2
m35
Risk-on tape amplifies high-beta semis
With beta 1.7 and VIX at 14.3, a calm risk-on regime mechanically supports semis broadly and gives UMC beta lift on up days.
m30
Geopolitical/reshoring narrative still live
The Taiwan-alternative and supply-chain de-risking angle keeps a bid under the name on any China-Taiwan headline or reshoring policy news.
Headwinds 4
m60
Fragile late-cycle narrative
The bull story rests on geopolitics and reshoring hype, not earnings power; fragile-durability narratives on cyclical names are the first to unwind when sentiment rotates.
m55
Selective AI rebound leaves UMC behind
GF Securities framing the next leg as 'more selective' pushes flows toward TSMC and leading-edge AI winners; UMC as a trailing-edge foundry is on the wrong side of that selection.
m50
Weak 3y relative momentum
-8.7% CAGR and -11pp of 3y underperformance signal persistent distribution and a lack of institutional sponsorship, which weighs on tape behavior even in up markets.
m40
Rates and market PE pressure premium multiples
10y at 4.63% and market PE 26.2 create a background de-rating force that lands harder on stocks trading well above fundamental anchors on a story.
Net headwind. The risk-on tape is a genuine but modest tailwind for a 1.7-beta chip name, and the geopolitical story still has a pulse - but the narrative is fragile, momentum is poor, and the freshest broker take is telling clients to get more selective inside the AI rebound, which is a polite way of saying 'own TSMC, not UMC.' Nothing catastrophic is pressing, but the balance of forces leans down.
Verify before trusting this (4)
  • Any sell-side note explicitly ranking foundries and where UMC lands in the 'selective AI' pecking order
  • Taiwan Strait or export-control headlines that could reawaken the geopolitical premium
  • Sector rotation signals - if flows leave semis for defensives, high-beta UMC gets hit disproportionately
  • Next earnings tone on pricing/utilization; a soft print would crack the fragile narrative fast
The market-wide tape + this name's exposure to it (beta / sector / narrative durability). Context on the non-fundamental pressure — not a call on the business or the price. processId: detail-general-sentiment
Growth Outlook
-48
Holding
edge √Σ 61 · risk √Σ 113 · conf 6/10

The world is bifurcating semiconductors. Capital and pricing power are migrating to leading-edge AI silicon, while mature nodes are being commoditised by state-subsidised Chinese capacity — a supply glut that does not clear on a normal cycle because the builders are not profit-maximising. Offsetting that, tariff regimes and China+1 sourcing are creating a real premium for non-China mature-node supply, which is UMC's single best structural card and the logic behind the Intel 12nm tie-up. Macro is a headwind (10y 4.63), which delays the auto/industrial and consumer-IoT restocking UMC depends on. Net: UMC's units survive, its ASPs and margins are the casualty.

Growth drivers 4
m40
Specialty process mix insulates part of the book
Embedded high-voltage (OLED/display driver), RFSOI, BCD and eNVM platforms are design-locked, multi-year-qualified and less substitutable than commodity logic. This is the piece of UMC's 22/28nm franchise that resists pure price shopping and supports the recent +4.4% revenue YoY turn.
m32
Cycle trough behind it in auto/industrial
After a multi-quarter inventory correction in automotive and industrial MCU/analog, sector demand reads 'steady' (score 0, category median +7.1%). Revenue YoY has flipped positive versus a -8.7% multi-year CAGR — a low-quality but real inflection in units and utilization.
m25
Intel 12nm co-development and non-China capacity
The 12nm FinFET collaboration on US soil plus Singapore Fab12i P3 gives customers a China-free mature-node source as tariff and supply-chain rules tighten. Revenue impact is 2027+, but it converts UMC from a pure price-taker into a sourcing-diversification option.
m22
Capacity additions convert to volume if pricing holds
Singapore P3 and Tainan 12A expansions add 22/28nm wafer starts into the one node band where non-China demand is genuinely tight. Volume growth is contracted, not speculative.
Growth risks 4
m70
Chinese mature-node overcapacity is structural, not cyclical
SMIC, Hua Hong and Nexchip are adding subsidised 28nm-and-above capacity aimed squarely at UMC's core. This is an ASP problem, not a volume problem: UMC can fill fabs and still see gross margin compress. Industry-wide operating margin is already -3.1pp over three years and industry earnings CAGR is -15%.
m63
Structurally excluded from the AI node cycle
The industry's recent +20.5% YoY versus 4.6% long-term is almost entirely leading-edge and HBM-adjacent. UMC serves none of it. So category strength is not UMC strength — the tide it sits in is the flat 4.6% mature-node tide, not the 20.5% headline.
m49
Depreciation step-up outruns revenue
New Singapore/Tainan capacity carries fixed depreciation into a soft-pricing environment. This is the mechanism behind recent earnings -18.3% YoY on revenue +4.4%, and it persists for several years regardless of demand.
m39
Extreme utilization/FX leverage
Foundry P&L is a utilization function; a few points of loading or NTD appreciation swings operating income double digits. Volatility of 0.123 and a negative-year history confirm the book has no defensive floor.
vs expectations: ~6m above · 1y inline · 2-3y below
The forward growth verdict — is the business itself likely to grow (next 2 quarters / year 1 / years 2–3), judged against its category and against printed expectations. The full horizon ladder + creme renders on the Growth Outlook card above. Not a call on the price (Valuation owns that) or the tape (Sentiment owns that).
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Lenses kept deliberately separate — Company Quality (price-agnostic), Valuation (price-conditional), General Sentiment (non-fundamental macro/narrative pressure), and Growth Outlook (the forward growth verdict). The scores are not blended. Filing-level items (convertibles, lock-ups, customer concentration) are v2 — see each lens's "verify."
Price Prediction
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Prediction unavailable. valuation-synthesis has no result for UMC — the prediction needs its fair-value anchors.

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My Notes personal — only you see this
v1.1.648 · e285203f · 2026-09-21 16:44:18