SAS and Globalwafers Earnings: Numbers Are in Line, but Next Six Months Will Be Tough

We maintain our fair value estimates for Globalwafers and its parent Sino-American Silicon Products, or SAS, at TWD 590 and TWD 227 per share, respectively. Both names are undervalued and still our picks in the sector. We think the market is worried about pricing pressure amid the current downturn and has overly discounted the prospects of secular growth in semiconductors. We view the group’s expansion in silicon wafer operations more favorably as Globalwafers’ new plant is in the United States where competing expansions are scarce.