United Microelectronics Corporation (UMC) is a leading semiconductor wafer foundry, offering a range of services from circuit design and mask tooling to wafer fabrication, assembly, and testing. Established in 1980 and headquartered in Hsinchu City, Taiwan, the company operates in multiple locations around the world, including Singapore, China, Hong Kong, Japan, the United States, and Europe. It mainly serves fabless design companies and integrated device manufacturers.
as of February 9, 2023
Priced at 11x forward earnings, UMC may be the third largest chip foundry, but it is also the most undervalued when compared to Taiwan Semi and Samsung, both of which are valued in the hundreds of billions while United Micro is priced at just $22 billion. And, when you adjust for net cash it’s closer to $16 billion. The discrepancy is too large to ignore at this level. Especially when gross margins are 45% and return on equity is 28%.
