Value
6.8/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 7.4 |
| P/S | 10.0 |
| Fwd P/E | 6.3 |
| PEG | 7.1 |
| Analyst target | 3.0 |
- ▸Forward P/E: 20.5x
- ▸PEG: 0.99
UMC · Why this verdict
Why United Microelectronics Corpora (UMC) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score6.0/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
United Microelectronics Corporation has beaten or met earnings estimates in 3 of the last 4 quarters with an average surprise of 28%, carries strong margins of 21% and a Piotroski score of 8 out of 9, but trades at essentially zero upside to resistance and negative asymmetry, leaving no room for a favorable entry at current prices.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
United Microelectronics generates 21% net margins and carries a Piotroski F-Score of 8 out of 9 — a strong balance sheet health indicator — and scores 6.2 on quality overall, reflecting a more financially sound foundry operation than the market sentiment score suggests. Quality breakdown | Net margins stay above 18% and Piotroski score remains at 7 or above for the next 4 reported periods | ↑Improving |
| CounterROE and ROA scores are in the lower half of the semiconductor peer group, and a forward P/E of 28.3x is expensive for a foundry business with below-average peer rank on growth | ||
UMC beat earnings estimates by 56% in April 2026 and 68% in October 2025, with an average positive surprise of 28% across reporting periods, indicating the company is systematically delivering results above what analysts model. Earnings | EPS surprise stays above 10% in at least 2 of the next 4 quarters, sustaining the outperformance pattern | →Stable |
| CounterOne quarter (July 2025) was a miss of 11.4%, and high implied volatility of 132% suggests the market prices in significant earnings variability rather than predictable beats | ||
UMC is trading at $23.08 with a resistance-based take-profit of $23.22 — only $0.14 above current price — creating negative asymmetry of -4.06 and leaving virtually no upside for a new position at current levels. Targets | Price pulls back below $20, more than 12% below the current $23.08, before any new entry creates a favorable risk-reward profile | ↑Improving |
| CounterStrong OBV accumulation and position above the 200-day moving average suggest the stock has technical support; it could break above resistance and re-rate to higher analyst targets in the absence of an updated target | ||
The stock is trading within 2.6% of its 52-week high with momentum at 5.5 and volume accumulation, suggesting the recent rally has been genuine and buyers remain interested, but also that the easy money from the current cycle may already have been made. Bear case | Price breaks above the 52-week high and makes a new high above $24, confirming continuation of the uptrend | Tripped→Stable |
| CounterStocks near 52-week highs often encounter technical resistance and profit-taking; with negative asymmetry at the current price, the risk of mean-reversion is higher than the reward from a breakout | ||
United Microelectronics generates 21% net margins and carries a Piotroski F-Score of 8 out of 9 — a strong balance sheet health indicator — and scores 6.2 on quality overall, reflecting a more financially sound foundry operation than the market sentiment score suggests.
↑ImprovingQuality breakdown
- Expectation
- Net margins stay above 18% and Piotroski score remains at 7 or above for the next 4 reported periods
CounterROE and ROA scores are in the lower half of the semiconductor peer group, and a forward P/E of 28.3x is expensive for a foundry business with below-average peer rank on growth
UMC beat earnings estimates by 56% in April 2026 and 68% in October 2025, with an average positive surprise of 28% across reporting periods, indicating the company is systematically delivering results above what analysts model.
→StableEarnings
- Expectation
- EPS surprise stays above 10% in at least 2 of the next 4 quarters, sustaining the outperformance pattern
CounterOne quarter (July 2025) was a miss of 11.4%, and high implied volatility of 132% suggests the market prices in significant earnings variability rather than predictable beats
UMC is trading at $23.08 with a resistance-based take-profit of $23.22 — only $0.14 above current price — creating negative asymmetry of -4.06 and leaving virtually no upside for a new position at current levels.
↑ImprovingTargets
- Expectation
- Price pulls back below $20, more than 12% below the current $23.08, before any new entry creates a favorable risk-reward profile
CounterStrong OBV accumulation and position above the 200-day moving average suggest the stock has technical support; it could break above resistance and re-rate to higher analyst targets in the absence of an updated target
The stock is trading within 2.6% of its 52-week high with momentum at 5.5 and volume accumulation, suggesting the recent rally has been genuine and buyers remain interested, but also that the easy money from the current cycle may already have been made.
Tripped→StableBear case
- Expectation
- Price breaks above the 52-week high and makes a new high above $24, confirming continuation of the uptrend
CounterStocks near 52-week highs often encounter technical resistance and profit-taking; with negative asymmetry at the current price, the risk of mean-reversion is higher than the reward from a breakout
Per-dimension breakdown
Quality
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 6.8 |
| ROA | 3.9 |
| Gross margin | 2.3 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 9.7 |
| FCF quality | 4.2 |
| Moat | 7.5 |
| Piotroski F | 10.0 |
- ▸Strong margins: 32%
- ▸Earnings quality warning: 53% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
Growth
6.5/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 8.9 |
| EPS growth | 4.0 |
- ▸Strong growth: 26% YoY
Momentum
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 8.8 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 3.8 |
- ▸Oversold in uptrend (RSI 18)
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 3.9 |
| erm sentiment | 6.2 |
Insider
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Heavy insider selling — $230,429,600 (0.509% of mkt cap)
- ▸Institutions accumulating
Peer rank
6.3/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.0 |
| quality rank | 7.4 |
| growth rank | 4.2 |
- ▸Attractive P/E vs peers
Technical
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.5 |
| support resistance | 9.4 |
| 52w position | 2.6 |
| gap | 7.5 |
- ▸Extreme gap down (-5.9%) - potential reversal
Risk (lower is worse)
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.4 |
| days to cover | 8.3 |
| volatility | 0.7 |
| put call | 0.0 |
| implied vol | 3.7 |
| max pain risk | 3.0 |
| debt equity | 9.3 |
- ▸Elevated put/call: 4.80
- ▸Above max pain $14
Catalyst
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 7.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 6.8 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +1 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+1Passed (5)
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:89d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:3.5<4.5
- ASYMMETRY:-2.3=NEGATIVE
Warning (1)
- INSIDER:0.51%=MODERATE
Reward-to-Risk
-2.28
Upside
-21.5%
Downside
9.5%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Catalyst at 7.9) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:3.5<4.5, ASYMMETRY:-2.3=NEGATIVE) reinforce the read. Current asymmetry R:R is -2.28 — supplementary context, not the trigger for this path.
The strongest dimensions are Catalyst at 7.9, Quality at 7.2, and Technical at 7.0; the weakest are Momentum at 3.5, Risk (lower is worse) at 4.9, and Sentiment at 5.0. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -2.28 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Margins Piotroski Quality
Trip ifNet margins fall below 15% or Piotroski F-Score drops below 6 for 2 consecutive quarters
- P2Earnings Beats With Large Surprises
Trip ifEPS surprise falls below 0% in at least 3 of the next 4 quarters
- P3Price At Resistance Zero Upside
Trip ifPrice rises above $25, more than 8% above current $23.08, without analyst target revision supporting the new level
- P4Near 52 Week High MomentumTripped
Trip ifPrice drops below $21.46 stop-loss level, more than 7% below current price