AMKOR TECHNOLOGY, INC. (AMKR): what the price requires

Generated: 2026-07-19 · Source: https://boothcheck.com/report/AMKR

Headline

Field	Value
Ticker	AMKR
Company	AMKOR TECHNOLOGY, INC.
Current price	$66.46/sh

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

Field	Value
Inversion basis	whole-company
Operating margin needed	14.7%
Operating margin today	5.9%
Margin expansion implied	+8.8pp
Must persist for	16.2y
Multiple paid	44x operating income

The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 12.6% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~2.5 years.

Reconcile: at the x-ray's 9.3% required return this reads ~9 years; the models below use their own rates.

How unusual the bet is: elevated

Reference	Value
vs own history	+0.29σ
cohort percentile (of 178 peers)	74
sustained it ~10 years at this level	15%
implied end-window share	0%

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Family	Median price/FV	Models	Reads
Asset	3.45x	5	expensive
Earnings	3.25x	4	expensive
Relative	1.02x	5	expensive
Growth	1.02x	3	expensive

Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.6%); the inversion above states its own rate.

Per-Model Detail (n=17)

Model	Family	FV	Price/FV	Applicable	Methodology
DCF Perpetual Growth	Growth	$64.88	1.02x	yes	FCF base $0.6B, growth 13% (input: historical growth), terminal g 4.0%, WACC 8.6%, 6yr projection
DCF Exit Multiple	Growth	$78.01	0.85x	yes	Exit EV/EBITDA: 12.2x / 14.2x / 16.2x (bear / base = today's held flat / bull), 6yr
Relative Valuation	Relative	$64.13	1.04x	yes	P/E 26.81x (blended: static sector reference 22x + trailing (TTM) 38x), scenarios: 22.1x / 26.8x / 31.6x (bear / base = reference held flat / bull), EV/EBITDA 16x
Simple DDM	Growth	—	—	no	—
Two-Stage DDM	Growth	—	—	no	—
Simple Excess Return	Asset	$18.89	3.52x	yes	BV/sh $18.17, ROE (TTM) 9.6%, ke 9.3%
Two-Stage Excess Return	Asset	$19.26	3.45x	yes	5yr excess ROE then converge to ke=9.3%
Discounted Future Market Cap	Growth	$61.75	1.08x	yes	Rev $7.1B, growth 13% (input: historical growth; tapered), Terminal P/S: 1.9x / 2.3x / 2.8x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair Value	Relative	$60.90	1.09x	yes	EPS $1.74, growth 35% (input: historical EPS growth), PEG=1.09 (Fair)
Margin Trajectory	Growth	—	—	no	—
Earnings Power Value	Earnings	$22.38	2.97x	yes	Normalized EBIT (5y avg op income, one-time charges added back) $0.60B × (1−13%) / WACC 8.6% → EPV (no growth)
Residual Income	Asset	$19.32	3.44x	yes	BV $18.17 + 5yr PV of (ROE (TTM) 9.6% − Kₑ 9.3%) × BV; BV grows 6.3%/yr
Graham Number	Asset	$26.67	2.49x	yes	√(22.5 × EPS $1.74 × BVPS $18.17) — Graham's conservative floor
EV/EBITDA Relative	Relative	$75.18	0.88x	yes	EBITDA $1.20B × sector EV/EBITDA 16.0x
FCF Yield	Earnings	$5.80	11.46x	yes	FCF $167.2M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF Yield	Earnings	—	—	no	—
Ben Graham Formula	Earnings	$56.14	1.18x	yes	EPS $1.74 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/B	Asset	$3.78	17.58x	yes	BV $18.17 × (ROIC 1.8% / WACC 8.6%)
P/Sales Sector	Relative	$141.67	0.47x	yes	Revenue $7.07B × sector P/S 5.0x
PEG Fair Value	Relative	$65.25	1.02x	yes	EPS $1.74 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings Yield	Earnings	$18.81	3.53x	yes	EPS $1.74 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations Multiple	Relative	—	—	no	—
Clinical Phase NPV	Growth	—	—	no	—
Merton	Asset	—	—	no	—
V5 Mechanical	—	—	—	no	—

Solvency

Field	Value
Net cash	$298.8m
Net debt / NOPAT (after-tax)	-0.90x (net cash)
Net debt / operating income (pre-tax)	-0.78x (net cash)
Interest coverage	5.3x
Share count CAGR (dilution)	0.4%
Burning cash	no

Bullet Takeaways

• Amkor is the assembly-and-test back end of the chip industry, splitting its business between higher-value Advanced Products and commodity Mainstream Products, and the swing toward advanced packaging for AI and automotive is what the bull case rides on.
• The price is the risk: at roughly 60 times operating income, it embeds both a jump in operating margin from about 8% today toward the low 20s and a growth pace that has to persist for two decades, a combination history rarely delivers in a capital-heavy packaging business.
• The balance sheet is the cushion under that bet: Amkor runs a small net cash position with interest coverage around 7 times, which funds the Arizona facility ramp and advanced-packaging capacity without forcing dilution, and the next catalysts are the second-half compute programs and the AI portfolio management guides to triple in 2026.

Bull Case

The balance sheet is the quiet strength that makes Amkor's growth bet fundable, and it is unusual for a business this capital-intensive. The company runs a small net cash position, roughly $299 million more cash than debt, with interest coverage near 7 times trailing operating income. Packaging and test is a business of heavy fixed assets, where cost of sales "consists principally of materials, labor, depreciation and manufacturing overhead," so a clean balance sheet is the difference between funding a capacity ramp out of cash flow and raising equity into it. Amkor is doing the former: it is building the Arizona facility and adding advanced-packaging capacity while the share count is essentially flat, which means the growth is being financed without diluting the owners who are paying for it.

The growth itself sits in the right half of the business. Amkor splits its work into "Advanced Products" (high-density fan-out, flip chip, and related test) and "Mainstream Products" (wirebond and power-device packaging), and the mix is shifting toward the advanced side where AI compute and automotive demand are concentrated. The filing names the auto tailwind directly, noting that content "in automobiles is driving demand for advanced packaging to enable safety features such as ADAS, in-car computing, radar and digital cockpit features." Advanced packaging is also where the chip industry's hardest physical problems now live, as transistor scaling slows and performance gains move into how dies are stitched together. That is structurally good for an assembler whose value rises exactly as packaging complexity does.

The recent print shows the demand arriving rather than being promised. First-quarter 2026 revenue reached $1.68 billion, up 27% year over year, with gross margin of 14.2% exceeding the high end of guidance, and the company guided second-quarter revenue to $1.75 to $1.85 billion with EPS of $0.42 to $0.52. Management has framed the AI advanced-packaging portfolio to triple in 2026, with new compute programs and the Arizona facility ramping in the second half. A 27% revenue jump with margin beating guidance is the early evidence the advanced-packaging mix shift is real money, not a slide-deck thesis.

Bear Case

The variable with the most leverage on this thesis is one Amkor does not control: the demand cycle of its handful of large customers. Outsourced assembly and test is a derivative bet on someone else's silicon, and when the chip designers Amkor serves pull back, the packaging volume falls with them and the heavy fixed-cost base turns from operating leverage into a margin trap. The market saw this clearly enough that the stock fell roughly 8.6% even after a quarter that beat across the board, a tell that the buyers are pricing the cycle, not just the print. A back-end packager carries the semiconductor industry's cyclicality with a thinner margin to absorb it.

That thin margin is the bear's hardest number. The price embeds operating margins climbing from about 8% today toward the low 20s, and the filing shows why that is a stretch: gross margin has hovered in a tight band, "Gross margin 14.0 % $ 14.8 % $ 14.5 %" across recent years, with no structural march upward. Amkor competes against rivals the filing acknowledges "are larger than us, have lower cost structures, and may be willing or able to sell their services at lower margins," which is the precise mechanism that keeps packaging margins capped. For the price to be right, Amkor has to break a multi-year pattern of mid-teens gross margin and roughly single-digit operating margin, against larger competitors whose cost advantage pushes the other way.

The duration of the bet is what turns elevated into demanding. At roughly 60 times operating income, the price requires growth to persist at its self-funding ceiling for about two decades, and only about 15% of comparable fast-growers have sustained that pace for even ten years. The near-term rate is within what Amkor has delivered; the problem is the length of the runway the price assumes, in an industry whose defining feature is that demand arrives in waves and capacity gets overbuilt at the top of each one. The macro exposure, customer concentration, competitive pricing, and the auto and AI cycles all feed the same risk: the price is paying for a smoothness that semiconductor packaging has never historically had.

Valuation

At the current price the market pays about 60 times company-wide operating income, and inverting that reveals a two-part bet: operating margins have to climb from roughly 8% today toward the low 20s, and growth has to hold near its self-funding ceiling for about two decades. The rate of growth is within what Amkor has recently delivered; the demand is in the persistence and the margin. Against history, only about 15% of comparable fast-growers sustained that pace for even ten years, which is why this reads as an elevated assumption rather than a comfortable one.

The methods we use to triangulate are nearly unanimous in one direction, and that unanimity is the signal. The asset-value lens reads the price several times above book, the earnings-power lens reads it several times above what current operating earnings support, and even the peer-multiple lens places Amkor above where its packaging and contract-manufacturing comparables trade. Only the growth-discounted-cash-flow method reaches the price, and it does so by crediting the multi-decade compounding the inversion describes. When three of four families say richly valued and only the forward-growth method defends the level, the price is a durability premium the static frames structurally cannot price. The buyer is paying for a moat in advanced packaging to hold for a very long time.

Solvency is the one place the picture is reassuring, and it belongs in the close because it bounds the downside without justifying the price. Amkor carries a small net cash position with interest coverage near 7 times, so the balance sheet is not where this breaks; the company can fund the Arizona ramp and advanced-packaging capacity without leaning on debt or dilution, and the share count has been essentially flat. The risk is not insolvency, it is that the price has already paid for twenty years of smooth compounding in a business whose gross margin has sat in a mid-teens band and whose demand moves in cycles. The balance sheet protects the equity; it does not make the embedded assumption any easier to meet.

Catalysts

The first-quarter 2026 print was a clean beat that the market still sold. Revenue came in at $1.68 billion, up 27% year over year, EPS was $0.33, and gross margin of 14.2% topped the high end of guidance, yet the stock fell roughly 8.6% afterward. The decline after a beat is itself the signal: with a price this far ahead of the static methods, an in-line-to-strong quarter is not enough, and the buyers are looking past the print to the second-half ramp. For the second quarter, Amkor guided revenue of $1.75 to $1.85 billion and EPS of $0.42 to $0.52, implying sequential growth.

The catalysts that matter are concentrated in the back half of 2026. Management has guided the AI advanced-packaging portfolio to triple this year, with new compute programs and the Arizona facility ramping in the second half, and points to next-generation data-center CPUs and automotive content as the demand drivers. Those are the events that either validate the durability the price assumes or expose the gap. The watch list is straightforward: whether the advanced-products mix keeps climbing, whether the Arizona ramp converts to revenue on schedule, and whether gross margin finally breaks above the mid-teens band the filings have shown for years.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• ASX (ASE Technology Holding Co., Ltd.)
• FY2025 20-F: …may negatively impact our business. Increasing competition may lead to declines in product prices and profitability and could have a material adverse effect on our business, financial condition, results of operations, and future prospects. Our profitability depends on our ability to respond to rapid technological…
• FY2025 20-F: …the end-use applications of various products, such as communications, computing, and consumer electronics products. Any deterioration of conditions in the markets for the end-use applications would reduce demand for our services and would likely have a material adverse effect on our financial condition and results of…
• TSEM (TOWER SEMICONDUCTOR LTD.)
• (no filing in the citation store)
• GFS (GLOBALFOUNDRIES Inc.)
• (no filing in the citation store)
• UCTT (Ultra Clean Holdings, Inc.)
• FY2025 10-K: . Although some of our business, including the cleaning, coating and analytical services that support the semiconductor chip market, are less susceptible to such fluctuations, recurring slowdowns in the industries we serve have historically had adverse effects on our overall operating results. Demand shifts in these…
• FY2025 10-K: …effectiveness, we have expanded our total available market significantly. • Develop or acquire solutions that allow our customers to succeed at the leading edge of the semiconductor processing nodes . Leveraging our technology roadmap assessments and broad customer engagements, we continue to expand the number and…
• PLXS (PLEXUS CORP.)
• FY2025 10-K: In addition, current and prospective customers continually evaluate the merits of designing, manufacturing and servicing products internally and may choose to design, manufacture or service products (including products or product types that we currently design, manufacture or service for them) themselves rather than…
• FY2025 10-K: …Increased competition could result in significant price reductions, reduced sales and margins, or loss of customers or market share. The majority of our net sales come from a relatively small number of customers and a limited number of market sectors; if we lose a major customer or program or if there are challenges…
• FLEX (FLEX LTD.)
• FY2025 10-K: …of our component capabilities, together with start-up and integration costs, has in the past adversely affected, and may in the future adversely affect, our margins and profitability. Our components business, which includes our data center power systems business, is part of our strategy to improve our competitive…
• FY2025 10-K: …2025, mitigates data center heat challenges with patented microconvective cooling technology, capable of cooling over 3,000W, as well as offering complete turn-key microconvective cooling systems that include fully-sealed cold plates, direct liquid-to-chip products, and a coolant distribution unit (CDU). COMPETITION…
• BHE (BENCHMARK ELECTRONICS, INC.)
• FY2025 10-K: …the in-house manufacturing capabilities of current and potential customers. Our competitors include Celestica Inc., Flex Ltd., Jabil Inc., Kimball Electronics Inc., Plexus Corp, and Sanmina Corporation. We believe that the principal competitive factors in our focus end-markets are our engineering capabilities,…
• FY2025 10-K: …the availability of electronic component supply, or the failure of a major customer to pay for components or services have adversely affected us by not allowing us to fulfill our total customer demand. A substantial percentage of our sales are made to a small number of customers, and the loss of a major customer, if…
• TTMI (TTM TECHNOLOGIES INC)
• FY2025 10-K: …sources with the goal of ensuring that we are receiving competitive pricing and service. Supply for PCB materials can vary over time depending on supply/demand dynamics for key raw materials such as copper clad laminates. See Item 1A, Risk Factors for more details. Competition For PCBs, our competitors are mostly…
• FY2025 10-K: …that key customers would not cancel orders, that they would continue to place orders with us in the future at the same levels as experienced by us in prior periods, that they would be able to meet their payment obligations, or that the end-products that use our products would be successful. This concentration of…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Amkor Q1 2026 results, 8-K April 2026 · Amkor Q1 2026 earnings call, April 2026 · Amkor Q1 2026 results coverage, April 2026 · Amkor Q1 2026 results, 8-K and earnings coverage, April 2026