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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#3526
Positioning
Market Dominance
Manufacturing
Electronic Equipment
$112M
Young-Joon Kim
Magnachip Semiconductor Corporation designs, manufactures, and supplies analog and mixed-signal semiconductor platform solutions for communications, the Internet of Things, consumer, industrial, and automotive applications. It provides display solutions, including source and gate drivers, and timing controllers that cover a range of flat panel displays used in mobile communications, automotive, entertainment devices, notebook PCs, monitors and liquid crystal displays.
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| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UL UNILEVER PLC | 78 | 96 | 98 | 59 | - | - | 28.5% | 8.0% | 100.0% | 100.0% | 10.4% | -4.6% | 3.3% | 0.0x | $141.8B | VS | |
$ASML ASML HOLDING NV | 77 | 89 | 86 | 83 | - | - | 46.1% | 16.6% | 51.3% | 31.9% | 26.8% | -4.0% | 1.0% | 25.0x | $272.1B | VS | |
$ESLT ELBIT SYSTEMS LTD | 76 | 81 | 87 | 85 | - | - | 10.3% | 3.1% | 24.1% | 7.2% | 4.7% | 14.3% | 0.8% | 25.0x | $11.4B | VS | |
$MT ArcelorMittal | 75 | 71 | 98 | 85 | - | - | 2.2% | 1.5% | 9.3% | 5.3% | 2.2% | -8.5% | 2.2% | 16.0x | $18.9B | VS | |
$AMAT APPLIED MATERIALS INC /DE | 75 | 85 | 87 | 84 | 20.9x | 13.6x | 35.5% | 19.8% | 48.7% | 29.2% | 24.7% | 4.4% | 0.8% | 32.0x | $181.9B | VS | |
$SIMO Silicon Motion Technology CORP | 75 | 84 | 86 | 85 | - | - | 11.8% | 8.8% | 45.9% | 11.3% | 11.1% | 25.7% | 3.7% | 0.0x | $1.8B | VS | |
$CODA Coda Octopus Group, Inc. | 74 | 83 | 90 | 79 | 16.3x | 11.9x | 7.6% | 7.0% | 66.5% | 17.1% | 15.6% | 39.0% | 0.0% | 0.0x | $115M | VS | |
$GSK GSK plc | 74 | 84 | 90 | 70 | - | - | 22.6% | 4.9% | 71.2% | 12.8% | 9.4% | 1.7% | 5.9% | 124.0x | $72.1B | VS | |
$EFXT Enerflex Ltd. | 74 | 80 | 91 | 83 | - | - | 3.0% | 1.1% | 20.9% | 7.3% | 1.3% | 3.0% | 0.9% | 67.0x | $1.2B | VS | |
$BUD Anheuser-Busch InBev SA/NV | 74 | 84 | 97 | 63 | - | - | 8.2% | 3.5% | 55.3% | 25.9% | 12.4% | 0.7% | 1.7% | 0.0x | $87.0B | VS | |
$MX MAGNACHIP SEMICONDUCTOR Corp | 40 | 41 | 14 | 31 | - | - | -12.2% | -8.7% | 20.8% | -17.8% | -15.5% | -13.6% | 0.0% | 41.0x | $112M | ||
| SECTOR BENCH | - | - | - | - | - | 22.3x | 11.5x | -2.5% | -0.1% | 42.5% | 1.3% | -0.2% | 5.9% | 0.0% | 0.2x | - | REF |
MAGNACHIP SEMICONDUCTOR Corp (MX) receives a "Reduce" rating with a composite score of 40.1/100. It ranks #3526 out of 7,333 stocks in our coverage universe and carries a 2-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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YOY expansion rate
Core pricing power
Operating efficiency
Bottom-line conversion
Equity capital efficiency
Asset base utilization
Financial leverage load
Direct cash return
Young-Joon Kim
Chief Executive Officer
Labor Force
900
41
51
48
Audit Verdict: Lower quality and stability scores may indicate governance concerns.
No recent insider transactions available for MX
Lagging peers — losers tend to keep underperforming
Expensive relative to fundamentals — limited margin of safety
Average quality profile
Average volatility — neutral timing signal
Moderate investment profile
Mid-range overall rating
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Relative valuation derived from Manufacturing sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
No analyst ratings for MX.
View All RatingsMaterial decline in asset turnover efficiency detected
High margin volatility — erratic forensic earnings quality
ROE proxy -12.2% (sector -2.5%)
GM 21% vs sector 43%, OM -18% vs sector 1%
Capital turnover N/A, R&D intensity 15.0%
Rev growth -14%, 10yr history
Interest coverage N/A
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
MAGNACHIP SEMICONDUCTOR Corp receives a Reduce rating from our analysis, with a composite score of 40.1/100 and 2 out of 5 stars, ranking #3526 out of 7,333 stocks. MX's factor profile shows weakness across multiple dimensions, suggesting the stock may underperform going forward. Existing holders may want to consider trimming positions or tightening stop-losses.
MX's quality score of 41/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of -12.2% (sector avg: -2.5%), gross margins of 20.8% (sector avg: 42.5%), net margins of -15.5% (sector avg: -0.2%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
MX registers a value score of just 14/100, suggesting the stock trades at a significant premium to its fundamental metrics. Key valuation metrics include a P/B ratio of 0.37x. High-premium valuations like this require strong future execution to avoid multiple compression, and downside risk is elevated if growth disappoints.
With an investment score of 51/100, MX exhibits moderate growth-oriented spending. Key growth metrics include revenue growth of -13.6% vs. a sector average of 5.9% and a return on assets of -8.7% (sector: -0.1%). The company appears to be balancing growth investments with capital returns, though the pace of investment may not be enough to accelerate top-line growth meaningfully.
MX is currently showing below-average momentum at 31/100, which may indicate weakening institutional interest or negative sentiment shifts. Revenue growth stands at -13.6% year-over-year, while a beta of 1.50 reflects its sensitivity to broader market moves. Investors should note that declining momentum can precede further price weakness, though contrarian opportunities sometimes emerge at these levels.
With a stability score of 48/100, MX exhibits average financial resilience. Key stability metrics include a beta of 1.50 and a debt-to-equity ratio of 41.00x (sector avg: 0.2x). While the balance sheet is not a major concern, the stock is subject to typical market volatility and may experience sharper drawdowns during risk-off episodes.
MX carries a short interest score of 70/100, indicating moderate short selling activity. This is a neutral reading — not enough to signal systemic bearishness, but worth monitoring. Specific risk factors include above-average market sensitivity (beta: 1.50), elevated leverage (D/E: 41.00x), micro-cap liquidity risk. At $112M market cap (micro-cap), MAGNACHIP SEMICONDUCTOR Corp offers reasonable institutional liquidity.
MAGNACHIP SEMICONDUCTOR Corp is a micro-cap company in the Manufacturing sector, ranked #0 of 50 in its sector (100th percentile) and #3526 of 7,333 overall (52nd percentile). Key comparisons include ROE of -12.2% trailing the -2.5% sector median and operating margins of -17.8% below the 1.3% sector average. This top-quartile standing reflects exceptional competitive strength relative to Manufacturing peers.
While MX currently exhibits a REDUCE profile, superior opportunities exist within the MANUFACTURING sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
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Improvement in Value (14) would have the largest impact on the composite score.
ROE 394% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 51% BELOW SECTOR MEDIAN
Op. Margin 1483% BELOW SECTOR MEDIAN
AUDIT DATA AS OF SEP 30, 2025 (Q2 FY2025)
We rate MAGNACHIP SEMICONDUCTOR Corp (MX) as a Reduce with a composite score of 40.1/100 at a current price of $2.63. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential and elevated risk of underperformance relative to peers over the next 12 months.
The rating is primarily driven by strength in investment (51th percentile) and stability (48th percentile), which together account for the majority of the composite score. Offsetting weakness in value (14th percentile) and momentum (31th percentile) tempers our overall conviction. We assign a No Moat rating (24/100), High uncertainty, and Poor capital allocation.
Key items to watch: momentum to confirm whether the current price trend has legs; the path to profitability; valuation compression risk if growth disappoints. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.
MAGNACHIP SEMICONDUCTOR Corp holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 40.1/100 places it at rank #3526 in our full 7,333-stock universe. At $112M in market capitalization, MAGNACHIP SEMICONDUCTOR Corp is a small-cap player in the Manufacturing space, which limits certain scale advantages but may allow for more agile strategic execution.
Revenue contraction of -14% combined with momentum at the 31th percentile paints a cautious picture of the near-term business outlook. The market appears to be pricing in continued challenges, and a catalyst for reversal is not clearly visible from current data.
The margin cascade tells an important story: gross margins of 21% (-21.7pp vs sector) narrow to operating margins of -18% (-19.1pp vs sector) and net margins of -15.5%, yielding a gross-to-net conversion rate of -75%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.
At a current price of $2.63, MAGNACHIP SEMICONDUCTOR Corp is trading at a premium to fundamental value. Our value factor score of 14/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The premium valuation implies the market is pricing in significant future growth or quality improvements that are not yet fully reflected in current fundamentals.
The stock currently trades at P/B of 0.4x, P/S of 0.5x. We evaluate these multiples in the context of both absolute levels and sector-relative positioning to form our valuation view.
The stock may offer contrarian value if near-term headwinds prove transitory — the current weakness in factor scores may reverse if business fundamentals stabilize.
The Reduce rating (composite 40.1/100) reflects multi-factor weakness, and historically, stocks in this scoring range have underperformed the market by a meaningful margin.
Revenue decline of -14% signals business deterioration — declining revenues make it difficult to grow into the current valuation and often precede further negative revisions.
Thin net margins of -15.5% provide limited cushion against cost pressures, competitive pricing, or macroeconomic headwinds — even small changes in costs could swing the company to a loss.
Weak momentum (31th percentile) suggests institutional selling pressure and unfavorable technical dynamics that may persist.
We assign a High uncertainty rating to MAGNACHIP SEMICONDUCTOR Corp. Key risk factors include elevated market sensitivity (beta of 1.50), current negative profitability (net margin -15.5%). The wide range of potential outcomes widens our fair value estimate and increases the possibility of permanent capital impairment. Investors considering this name should size positions accordingly and demand a meaningful margin of safety before initiating.
Specific risk factors that inform our assessment include: elevated market sensitivity (beta of 1.50); current negative profitability (net margin -15.5%). Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 48th percentile and quality factor at the 41th percentile provide a quantitative summary of the overall risk landscape.
We identify limited risk mitigants at this time, which contributes to our high uncertainty assessment. Investors should monitor for improvement in balance sheet metrics, margin stability, and business predictability that could warrant a downgrade in our risk assessment over time.
We rate MAGNACHIP SEMICONDUCTOR Corp's capital allocation as Poor. Key concerns include low returns on equity (-12.2%), negative profitability, weak asset returns (ROA -8.7%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — MAGNACHIP SEMICONDUCTOR Corp significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.
Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.
In summary, MAGNACHIP SEMICONDUCTOR Corp receives a Reduce rating with a composite score of 40.1/100 (rank #3526 of 7,333). Our quantitative framework assigns a No Moat (24/100, trend: stable), High uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 37/100.
Our analysis does not support a constructive view on MAGNACHIP SEMICONDUCTOR Corp at this time. The combination of limited competitive advantages, high uncertainty, and poor capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.
Analysis derived from Blank Capital Research quantitative terminal. For informational purposes only. No trade solicitation. Past performance not indicative of future results. Consult a qualified advisor.
We do not assign MAGNACHIP SEMICONDUCTOR Corp a meaningful economic moat, scoring 24/100 on our composite assessment. Current fundamentals do not demonstrate the kind of durable competitive advantages — such as superior returns on invested capital, margin superiority, or reinvestment efficiency — that would protect the company from competitive erosion over the long term. The highest-scoring pillar, financial resilience, reached only 8.9/20.
The strongest moat sources are financial resilience (8.9/20) and margin superiority (6.7/20). Interest coverage N/A. GM 21% vs sector 43%, OM -18% vs sector 1%. These pillars form the core of MAGNACHIP SEMICONDUCTOR Corp's competitive identity and are the primary drivers of excess returns in our framework.
Areas of relative weakness include economic value creation (1.1/20) and growth durability (2.1/20). ROE proxy -12.2% (sector -2.5%). Improvement in these areas could meaningfully widen the moat over time, while deterioration would be an early warning of competitive erosion.
Our moat trend assessment is Stable. Multi-year ROIC and operating margin trajectories show neither meaningful improvement nor deterioration, suggesting the competitive position is steady. We expect MAGNACHIP SEMICONDUCTOR Corp's moat profile to remain largely unchanged absent a material shift in return on capital or industry dynamics.
Key profit drivers include declining revenues (-14%) that pressure the earnings outlook. The margin cascade from 21% gross to -18% operating to -15.5% net reveals the company's cost structure and reinvestment intensity. Our analysis indicates that profit quality is adequate though not exceptional, with the quality factor at the 41th percentile.
The margin profile shows gross margins of 21%, operating margins of -18%, net margins of -15.5%. Return metrics include ROE of -12.2% and ROA of -8.7%. Relative to the Manufacturing sector, gross margins are 21.7 percentage points below the sector median of 43%, and ROE of -12.2% compares to a sector median of -2.5%.
The balance sheet reflects moderate leverage with D/E of 41%, revenue growth of -14%. The sector median D/E is 0%, putting MAGNACHIP SEMICONDUCTOR Corp at higher leverage than the typical peer. Overall balance sheet health is adequate for the current business environment.
High beta of 1.50 means amplified losses in market selloffs — in a broad market correction, this stock would likely decline more than the index.
Above 50MA
37.18%
Net New Highs
+51081
LX International's enterprise value has significantly increased by two-thirds in three months, largely due to strong performance from its Indonesian coal mine investment and holdings in KLAY cryptocurrency. The company reported record sales and operating profit in the first quarter, fueled by high coal prices and cryptocurrency gains. LX International is also expanding its business scope through acquisitions and is expected to play a key role in LX Group's bid for Magnachip Semiconductor.
The U.S. Treasury Department has stated that the acquisition of Magnachip Semiconductor Corp (MX.N) by Chinese private equity firm Wise Road Capital poses "risks to national security." This declaration presents another hurdle for Chinese companies seeking investments in critical technology sectors abroad. The deal, valued at $1.4 billion, is now under review by regulatory authorities and is expected to require President Joe Biden's decision.
A number of stocks jumped in the afternoon session after the semiconductor sector received a major boost as Advanced Micro Devices (AMD) secured a deal to sell up to US$60 billion in artificial intelligence chips to Meta Platforms over five years.
Magnachip Semiconductor Corporation has launched a new series of Insulated Gate Bipolar Transistors (IGBTs) specifically designed for solar inverters and industrial Energy Storage Systems (ESS). These 650V and 1200V IGBTs feature advanced technology, including a 40% reduction in cell pitch and a 30% enhancement in Reverse Bias Safe Operating Area (RBSOA), resulting in increased current capacity and robust stability. The company aims to capitalize on the rapidly growing solar inverter and ESS market, projected to reach $2.7 billion by 2029.
This article reviews the Q3 2025 earnings of several analog semiconductor companies, focusing on Magnachip (NYSE:MX). Magnachip reported a 17.1% year-on-year revenue decrease, missing guidance, despite efforts to restructure and launch new products. The article also highlights the performance of Skyworks Solutions (NASDAQ:SWKS), Universal Display (NASDAQ:OLED), Himax (NASDAQ:HIMX), and Monolithic Power Systems (NASDAQ:MPWR) within the analog semiconductors sector.