MagnaChip (MX) AI Stock Analysis

• Market Cap: $141.01M
• Dividend Yield: N/A
• Average Volume (3M): 331.76K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.20
• Revenue Growth: 3.59%
• EPS Growth: -64.21%
• Country: US
• Employees: 881
• Sector: Technology
• Sector Strength: 75
• Industry: Semiconductors
• EPS (TTM): -0.10
• Shares Outstanding: 36,063,606
• 10 Day Avg. Volume: 547,623
• 30 Day Avg. Volume: 331,765
• PEG Ratio: 0.10
• Price to Book (P/B): 0.48
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -7.46
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $6.00
• Price Target Upside: 53.45% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 52 Neutral
• Price Target: $4.00 ▲( 2.30% Upside)

MagnaChip's stock score reflects the company's significant financial challenges, with declining revenues and negative profitability impacting its financial performance. The technical analysis indicates some short-term momentum, but valuation concerns, including negative earnings, weigh heavily. The earnings call provided some optimism with strategic growth plans, yet profitability issues persist. Overall, while there are areas of potential growth, substantial risks and financial instability remain.

Positive Factors

Financial Performance

Magnachip reported a solid quarter and guide, with operating expenses coming in much lower than expected.

Market Strategy

Management is guiding to 5% sequential growth as consumer markets improve and new design wins in industrial sectors are made.

Negative Factors

Revenue Targets

Revenue and margin targets are seen as aggressive, creating uncertainty about whether they can be achieved.

MagnaChip Business Overview & Revenue Model

Company Description

Magnachip Semiconductor Corporation, together with its subsidiaries, 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, and micro light-emitting diode (LED) televisions. The company also offers metal oxide semiconductor field-effect transistors, insulated-gate bipolar transistors, AC-DC converters, DC-DC converters, LED drivers, regulators, and power management integrated circuits for a range of devices comprising televisions, smartphones, mobile phones, wearable devices, desktop PCs, notebooks, tablet PCs, and other consumer electronics, as well as for power suppliers, e-bike, photovoltaic inverter, LED lighting, motor drive, and home appliances; and organic light-emitting diode display driver integrated circuits for OLED TVs. It serves consumer, computing, and industrial electronics original equipment manufacturers, original design manufacturers, and electronics manufacturing services companies, as well as subsystem designers in Korea, the Asia Pacific, the United States, Europe, and internationally. The company sells its products through a direct sales force, as well as through a network of agents and distributors. Magnachip Semiconductor Corporation was incorporated in 2004 and is based in Luxembourg, Luxembourg.

How the Company Makes Money

MagnaChip generates revenue primarily through the sale of its semiconductor products. In the Display Solutions segment, the company earns money by providing display driver integrated circuits (DDICs) for organic light-emitting diode (OLED) and liquid crystal display (LCD) panels, which are widely used in smartphones, televisions, and other consumer electronics. In the Power Solutions segment, revenue is derived from selling power management integrated circuits (PMICs) and other power-related semiconductor products used in various electronic devices and industrial applications. Additionally, MagnaChip benefits from strategic partnerships and long-term supply agreements with leading electronics manufacturers, which help stabilize its revenue streams and expand its market reach.

MagnaChip Financial Statement Overview

Summary

MagnaChip faces financial challenges with declining revenues and negative profitability margins. The company has a strong equity position and low debt, but negative cash flows and decreasing stockholders' equity suggest liquidity risks.

Income Statement

MagnaChip's income statement reveals a decline in revenue over recent years, with the TTM (Trailing-Twelve-Months) showing a slight revenue increase of 0.96% compared to the previous year. However, profitability remains a concern as the company has experienced negative net and operating income margins. The TTM gross profit margin stands at 22.57%, but net profit margin is negative, indicating issues with cost management and operational efficiency.

Balance Sheet

The balance sheet highlights a strong equity position with an equity ratio of 72.95% in the TTM period, suggesting a low leverage risk. However, the declining stockholders' equity over the years indicates potential financial strain. The debt-to-equity ratio is low at 0.01, reflecting limited reliance on debt financing.

Cash Flow

Cash flow analysis shows a negative free cash flow in the TTM period, with a significant deterioration from the previous year. The operating cash flow to net income ratio is negative, indicating that the company is struggling with cash generation from its core operations. This poses a challenge to sustaining operations without external financing.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
231.74M	230.05M	337.66M	474.23M	507.06M
	Gross Profit
51.91M	51.64M	101.26M	153.54M	128.32M
	EBIT
-53.03M	-57.64M	1.30M	53.68M	27.02M
	EBITDA
-44.51M	-30.05M	13.28M	89.58M	40.16M
	Net Income Common Stockholders
-54.31M	-36.62M	-8.04M	56.71M	57.06M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
138.61M	158.09M	225.48M	279.55M	279.94M
	Total Assets
379.32M	420.49M	516.64M	583.65M	571.69M
	Total Debt
3.22M	4.81M	5.49M	4.28M	88.11M
	Net Debt
-135.39M	-153.28M	-219.99M	-275.27M	-191.83M
	Total Liabilities
102.52M	75.89M	88.49M	130.89M	226.09M
	Stockholders Equity
276.80M	344.60M	428.15M	452.76M	345.60M
Cash Flow		Free Cash Flow
-17.73M	-10.23M	-18.62M	54.92M	-29.37M
	Operating Cash Flow
-6.13M	-3.01M	5.17M	87.74M	7.47M
	Investing Cash Flow
-11.67M	-7.66M	-24.93M	-31.44M	318.48M
	Financing Cash Flow
16.56M	-52.34M	-12.74M	-35.54M	-222.28M

MagnaChip Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MX, the sentiment is Positive. The current price of 3.91 is above the 20-day moving average (MA) of 3.45, above the 50-day MA of 3.39, and below the 200-day MA of 4.15, indicating a neutral trend. The MACD of 0.20 indicates Negative momentum. The RSI at 63.43 is Neutral, neither overbought nor oversold. The STOCH value of 55.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MX.

MagnaChip Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INTT	70 Outperform	$72.96M	25.19	-0.10%	―	5.19%	-101.31%
MRAM	70 Outperform	$137.05M	176.22	-0.31%	―	-22.48%	-102.37%
Sector *	61 Neutral	$11.41B	10.19	-7.05%	2.95%	7.46%	-10.52%
QUIK	54 Neutral	$81.56M	―	-24.87%	―	-20.12%	-660.05%
MX	52 Neutral	$141.01M	―	-14.88%	―	3.59%	-64.21%
GSIT	52 Neutral	$82.18M	―	-33.15%	―	-5.73%	47.83%
ATOM	52 Neutral	$203.26M	―	-90.30%	―	-78.70%	13.98%

MagnaChip Corporate Events

MagnaChip Executives Agree to Salary Reductions

On April 28, 2025, MagnaChip announced adjustments to the compensation of its top executives. CEO Young-Joon Kim agreed to a 20% salary reduction, while CFO Shin Young Park’s salary was reduced by 10%, both effective April 1, 2025. These reductions will remain until the company’s operating income is positive for two consecutive fiscal quarters. Additionally, Park’s amended service agreement includes a salary increase and provisions for severance in the event of a change in control.

Magnachip Announces Shutdown of Display Business

On April 8, 2025, Magnachip announced the shutdown of its Display business by the end of the second quarter of 2025, following a thorough review and unsuccessful attempts to sell the business. This strategic move aims to focus on the more profitable Power discrete and Power IC segments, with an expected reduction in annualized operating expenditures by 30% to 35%. The company is targeting a $300 million annual revenue run-rate with a 30% gross profit margin within three years, enhancing shareholder value.