Diodes (DIOD) AI Stock Analysis

• Market Cap: $3.18B
• Dividend Yield: N/A
• Average Volume (3M): 387.77K
• Price to Earnings (P/E): 49.7
• Beta (1Y): 1.70
• Revenue Growth: 10.45%
• EPS Growth: 4.37%
• Country: US
• Employees: 7,829
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 0.34
• Shares Outstanding: 45,877,457
• 10 Day Avg. Volume: 571,034
• 30 Day Avg. Volume: 387,767
• PEG Ratio: 0.68
• Price to Book (P/B): 1.22
• Price to Sales (P/S): 1.54
• P/FCF Ratio: 16.67
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 2.03
• Enterprise Value/Gross Profit: 6.51
• Enterprise Value/Ebitda: 13.07
• 1Y Price Target: $75.67
• Price Target Upside: 6.88% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 2.01
• Revenue Forecast (FY): $1.60B

• Rating: 75 Outperform
• Price Target: $69.00 ▼(-2.54% Downside)
• Action: Reiterated Date: 02/13/26
• Date: Action: Reiterated 02/13/26

The score is driven primarily by strong financial resilience (notably a highly de-levered balance sheet) and improving operating momentum highlighted in guidance and multi-year targets. Technicals also support the view with a clear uptrend. The main offset is valuation risk from a high P/E alongside still-pressured margins and uneven free cash flow.

Positive Factors

Delevered balance sheet

Diodes’ dramatic debt reduction and sizeable equity base provide durable financial flexibility. Low leverage limits refinancing and interest-rate risk, enables sustained capex or M&A funding, and supports continued share repurchases or buffering through semiconductor cycles without threatening solvency.

Design wins & product expansion

A large wave of new part numbers and rising addressable content per vehicle indicate deeper OEM design-in and stickier revenue streams. Broader product content in automotive and AI-related server components supports structural revenue growth and raises switching costs for customers over multi-year cycles.

Improving cash generation

Operating cash flow and FCF meaningfully improved in 2025 versus 2024, demonstrating better cash conversion. Sustained positive cash generation funds capex, R&D and buybacks while reducing reliance on external financing, strengthening the firm’s ability to execute multi-year growth targets.

Negative Factors

Gross margin pressure

Underutilized manufacturing capacity and underloading costs are creating a persistent margin overhang. Until utilization rises or fabs are converted, fixed-cost absorption will constrain gross margins and limit operating leverage, reducing sustainable profitability even as revenue rises.

Earnings volatility vs peak

Earnings have retracted sharply from 2022, reflecting cyclical revenue swings and margin compression. This lower earnings base increases execution risk for ambitious multi-year targets, constrains internal funding for R&D/capex, and makes sustained EPS recovery dependent on operational improvements.

High inventory & operational timing risk

Elevated inventory and long days tie up working capital and raise obsolescence risk in a cyclical end market. Concurrently, manufacturing services agreements are ending and timing/benefits of converting to in-house fabs remain uncertain, creating execution and timing risk for margin recovery.

Diodes Business Overview & Revenue Model

Company Description

Diodes Incorporated designs, manufactures, and supplies application-specific standard products in the discrete, logic, analog, and mixed-signal semiconductor markets worldwide. It focuses on low pin count semiconductor devices with one or more active or passive components. The company offers discrete semiconductor products, such as MOSFET, TVS, and performance Schottky rectifiers; GPP bridges and retifiers, and performance Schottky diodes; Zener and performance Zener diodes, including tight tolerance and low operating current type; standard, fast, super-fast, and ultra-fast recovery rectifiers; bridge rectifiers; switching diodes; small signal bipolar and prebiased transistors; thyristor surge protection devices; and transient voltage suppressors. It also provides analog products, such as power management devices comprising AC-DC and DC-DC converters, USB power switches, and low dropout and linear voltage regulators; linear devices, such as operational amplifiers and comparators, current monitors, voltage references, and reset generators; LED lighting drivers; audio amplifiers; and sensor products, including hall-effect sensors and motor drivers. The company offers mixed-signal products, such as high speed mux/demux products, digital switches, interfaces, redrivers, universal level shifters/voltage translator, clock ICs, and packet switches; standard logic products comprising low-voltage complementary metal–oxide–semiconductor (CMOS) and high-speed CMOS devices; ultra-low power CMOS logic products and analog switches; multichip products and co-packaged discrete, analog, and mixed-signal silicon in miniature packages; silicon and silicon epitaxial wafers; and crystals and oscillators. It sells its products to the consumer electronics, computing, communications, industrial, and automotive markets through direct sales, marketing personnel, independent sales representatives, and distributors. The company was incorporated in 1959 and is headquartered in Plano, Texas.

How the Company Makes Money

Diodes generates revenue primarily through the sale of its semiconductor products, which are used in a variety of applications including power management, signal conditioning, and data conversion. Key revenue streams include the sales of discrete semiconductors, such as diodes and transistors, as well as integrated circuits and specialty products. The company benefits from a diverse customer base, including large OEMs (Original Equipment Manufacturers) and contract manufacturers in the electronics industry. Additionally, Diodes has established strategic partnerships with other technology firms, which can enhance its product offerings and market reach. The company's focus on innovation and high-quality manufacturing processes contributes to its ability to command competitive pricing and maintain strong profit margins.

Diodes Financial Statement Overview

Summary

Very strong balance sheet (delevered with substantial equity), supporting low financial risk and flexibility. Operating cash flow improved in 2025, but free cash flow has been volatile and profitability remains well below the 2022 peak, reflecting ongoing margin compression in a cyclical downcycle.

Income Statement

Results show a clear downcycle from 2022’s peak profitability: revenue fell in 2023 and 2024 (both down year-over-year), and while 2025 revenue recovered modestly (+3.7%), earnings power remains pressured with EBIT dropping sharply versus prior years (2025 EBIT of ~$35M vs. ~$408M in 2022). Profitability was strong in 2021–2023, but the trend indicates margin compression and higher earnings volatility typical of semiconductors. Strengths include the return to top-line growth in 2025 and continued positive net income, but overall trajectory since 2022 is weaker.

Balance Sheet

The balance sheet is a major strength: leverage has been reduced dramatically over time, with total debt falling from ~$488M (2020) to ~$1.4M (2025) while equity steadily grew to ~$1.88B. This implies substantial financial flexibility and lower risk from interest-rate or refinancing pressure. The main weakness is that shareholder returns have cooled versus peak years (return on equity dropped materially from 2021–2022 levels to a low level in 2024), reflecting weaker profitability rather than balance sheet stress.

Cash Flow

Cash generation remains positive but uneven. Operating cash flow improved in 2025 (~$216M) versus 2024 (~$119M), showing better cash conversion, but free cash flow has been volatile and declined sharply in 2024 and again in 2025 (2025 free cash flow down ~26.6% year-over-year). In the years where data is available, free cash flow was meaningfully below net income (e.g., 2024), suggesting working-capital swings or elevated investment needs during the downturn. Strength: consistently positive operating cash flow and free cash flow across the period; weakness: recent free cash flow contraction and variability.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.48B	1.31B	1.66B	2.00B	1.81B
Gross Profit	462.44M	435.86M	658.18M	827.24M	670.36M
EBITDA	230.48M	202.15M	420.96M	532.02M	445.02M
Net Income	66.14M	44.02M	227.18M	331.28M	228.76M
Balance Sheet
Total Assets	2.45B	2.39B	2.37B	2.29B	2.19B
Cash, Cash Equivalents and Short-Term Investments	377.03M	316.13M	325.63M	343.79M	370.14M
Total Debt	95.61M	91.70M	98.36M	213.67M	334.55M
Total Liabilities	509.69M	517.33M	557.98M	705.39M	891.77M
Stockholders Equity	1.88B	1.80B	1.74B	1.51B	1.24B
Cash Flow
Free Cash Flow	137.15M	46.41M	130.15M	180.77M	197.35M
Operating Cash Flow	215.51M	119.44M	280.91M	392.50M	338.54M
Investing Cash Flow	-116.18M	-118.04M	-158.32M	-265.26M	-144.23M
Financing Cash Flow	-54.81M	-19.34M	-144.72M	-125.71M	-158.44M

Diodes Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 70.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DIOD, the sentiment is Positive. The current price of 70.8 is above the 20-day moving average (MA) of 65.07, above the 50-day MA of 58.02, and above the 200-day MA of 53.13, indicating a bullish trend. The MACD of 3.52 indicates Negative momentum. The RSI at 64.36 is Neutral, neither overbought nor oversold. The STOCH value of 33.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DIOD.

Diodes Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DIOD	75 Outperform	$3.18B	49.70	3.60%	―	10.45%	4.37%
ACLS	74 Outperform	$2.51B	21.09	11.74%	―	-20.69%	-37.67%
FORM	73 Outperform	$7.84B	152.23	5.48%	―	2.29%	-69.81%
SIMO	73 Outperform	$4.62B	37.19	15.25%	2.22%	-2.26%	9.74%
POWI	64 Neutral	$2.61B	120.04	3.11%	2.27%	10.50%	-52.00%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
VSH	55 Neutral	$2.66B	-303.78	-0.44%	2.67%	-0.84%	-189.44%

Diodes Corporate Events

Diodes Posts Strong Q4 Growth, Sets Ambitious Targets

On February 10, 2026, Diodes reported that fourth quarter 2025 revenue rose 15.4% year over year to $391.6 million, capping a 13% increase for the full year to $1.5 billion and marking a fourth straight quarter of double-digit growth. Strong demand in computing, particularly AI server applications, and double-digit gains in automotive and industrial markets supported higher revenue, with automotive sales up 24% year over year.

GAAP net income for 2025 climbed to $66.1 million, or $1.43 per diluted share, from $44 million a year earlier, while fourth quarter GAAP net income reached $10.2 million. Management highlighted initial gross margin improvement from richer automotive mix and ongoing manufacturing efficiency efforts, and introduced three-year interim targets of $2 billion in annual revenue, roughly 35%+ gross margin and more than $4 in non-GAAP EPS, underscoring expected operating leverage and earnings power.

The most recent analyst rating on (DIOD) stock is a Buy with a $68.00 price target. To see the full list of analyst forecasts on Diodes stock, see the DIOD Stock Forecast page.

Diodes Posts Strong Q4 Results and Bullish 2026 Outlook

Diodes Incorporated reported preliminary, unaudited fourth-quarter 2025 results on February 10, 2026, with revenue of $391.6 million at the high end of guidance, up 15.4% year-on-year, and full-year 2025 revenue growth of 13%, its strongest annual increase since 2021. GAAP net income for the quarter rose to $10.2 million and non-GAAP adjusted net income to $15.7 million, while EBITDA reached $41.9 million and free cash flow $12.4 million, supported by solid cash generation, a $382 million cash balance and ongoing share buybacks.

Management highlighted four consecutive quarters of double-digit annual revenue growth driven by robust demand across all target markets, led by a 25% full-year increase in computing revenue tied to AI servers and strong double-digit gains in automotive and industrial end markets. The company noted improving gross margins from a richer automotive product mix, continued focus on reducing underloading costs, and an outlook for first-quarter 2026 revenue of about $395 million, implying above-seasonal trends and a fifth straight quarter of double-digit year-on-year growth, underscoring Diodes’ strengthening competitive position and design-in momentum.

The most recent analyst rating on (DIOD) stock is a Buy with a $68.00 price target. To see the full list of analyst forecasts on Diodes stock, see the DIOD Stock Forecast page.

Diodes to Announce Q4 and Full-Year 2025 Results

On January 20, 2026, Diodes Incorporated announced it will release its fourth quarter and full-year 2025 financial results on February 10, 2026, with the earnings announcement scheduled for that afternoon followed by a conference call at 4:00 p.m. Central Time. President and CEO Gary Yu, CFO Brett Whitmire, and Senior Vice President of Worldwide Sales and Marketing Emily Yang are slated to host the call, which will be accessible to analysts and investors via telephone and live webcast, with replay options available by phone through February 17, 2026 and online for approximately 90 days, underscoring the company’s efforts to maintain transparent communication with the investment community around its recent financial performance.

The most recent analyst rating on (DIOD) stock is a Buy with a $64.00 price target. To see the full list of analyst forecasts on Diodes stock, see the DIOD Stock Forecast page.