tw-stock-analysis

Taiwan Stock Fundamental Analysis

Framework

IRON LAW: Valuation Is Relative — Compare to Peers and History

A P/E of 20 is cheap for a growth tech stock but expensive for a mature
utility. ALWAYS compare to: (1) industry peers, (2) the stock's own
historical range, and (3) the broader market (TAIEX average P/E ~14-18).
A single number in isolation is meaningless.

Key Metrics for Taiwan Stocks

Metric	Formula	What It Tells You	Data Source
EPS	Net Income / Shares Outstanding	Profitability per share	公開資訊觀測站 (MOPS)
P/E Ratio	Stock Price / EPS	How much market pays per dollar of earnings	Yahoo Finance TW, Goodinfo
P/B Ratio	Stock Price / Book Value per Share	Premium to net assets	MOPS
Dividend Yield	Annual Dividend / Stock Price	Income return	公開資訊觀測站
Payout Ratio	Dividends / Net Income	Sustainability of dividends	Calculated
ROE	Net Income / Shareholders' Equity	Return on equity	MOPS
Debt-to-Equity	Total Debt / Equity	Financial leverage	MOPS
Revenue Growth	(Current Rev - Prior Rev) / Prior Rev	Top-line momentum	Monthly revenue reports

Taiwan-Specific Data Sources

Source	What It Has	URL
公開資訊觀測站 (MOPS)	Financial statements, dividends, insider trading	mops.twse.com.tw
台灣證券交易所 (TWSE)	Stock prices, trading volume, indices	www.twse.com.tw
Goodinfo	Historical financials, dividend history, technical data	goodinfo.tw
證交所月營收	Monthly revenue announcements (by the 10th)	MOPS + news

Analysis Steps

Phase 1: Business Understanding

• What does the company do? Which industry/sector?
• Who are the main competitors?
• What drives revenue? (products, segments, geographies)

Phase 2: Financial Health

• Revenue trend (monthly data unique to Taiwan market — check 月營收)
• Profitability: EPS trend, operating margin trend
• Balance sheet: D/E ratio, current ratio, cash position
• Cash flow: operating CF positive? Free cash flow trend?

Phase 3: Valuation

• P/E vs peers, vs own 5-year range, vs TAIEX average
• P/B vs peers (especially for asset-heavy industries)
• Dividend yield vs peers and vs Taiwan 10-year bond yield (~1.5%)

Phase 4: Growth & Risk

• Revenue growth rate vs industry
• Capex plans (MOPS announcements)
• Concentration risk (customer, product, geography)
• Regulatory and geopolitical risks

Taiwan Market Specifics

Feature	Detail
Monthly revenue disclosure	Listed companies report monthly revenue by the 10th — unique to Taiwan, provides more timely data than quarterly reports
Dividend culture	Taiwan investors heavily favor dividend stocks. High-yield stocks trade at a premium.
Ex-dividend price adjustment	Taiwan stocks drop by the dividend amount on ex-date. This is normal, not a loss.
Day trading tax	Securities transaction tax: 0.3% (0.15% for day trades). Factor into short-term trading costs.
Foreign investor influence	外資 (foreign institutional investors) buying/selling data is public and significantly moves stock prices. Monitor 三大法人 (three institutional investors) data.

Output Format

# Stock Analysis: {Company Name} ({Stock Code})

## Company Overview
- Industry: {sector}
- Market cap: NT${X}B
- Main business: {description}

## Financial Summary
| Metric | Current | 3-Year Avg | Peer Avg | Assessment |
|--------|---------|-----------|---------|-----------|
| EPS | NT${X} | NT${X} | NT${X} | Above/Below |
| P/E | {X}x | {X}x | {X}x | Cheap/Fair/Expensive |
| Dividend Yield | {%} | {%} | {%} | ... |
| ROE | {%} | {%} | {%} | ... |
| D/E | {X} | {X} | {X} | ... |

## Revenue Trend (Monthly)
| Month | Revenue (NT$M) | YoY Growth |
|-------|-------------|-----------|
| {month} | {amount} | {%} |

## Valuation Assessment
{Cheap / Fair / Expensive — with rationale comparing to peers and history}

## Key Risks
1. {risk}

## Investment Thesis
{Bull case vs bear case in 2-3 sentences each}

Gotchas

• EPS can be distorted by one-time items: Check if EPS includes asset sales, legal settlements, or write-offs. Use "recurring EPS" (本業 EPS) for trend analysis.
• Monthly revenue ≠ profitability: A company growing revenue 30% might have declining margins. Revenue growth without margin analysis is incomplete.
• Dividend yield trap: A stock yielding 8% may be cheap for a reason (declining business, unsustainable payout). Check if the payout ratio > 80% — that may not be sustainable.
• Taiwan stock prices adjust for dividends: Unlike US stocks, Taiwan stock prices drop by the cash dividend amount on ex-date. A NT$100 stock paying NT$5 opens at NT$95. This is not a loss — you received NT$5 in cash.
• This is educational analysis, not investment advice: All investment carries risk. Past performance does not predict future results. Consult a licensed financial advisor.

References

• For DCF valuation methodology, see the biz-dcf skill
• For financial ratio deep-dive, see the biz-financial-ratios skill