Silicon Motion Technology Corporation American Depositary Shares (SIMO)

FairStock Score: 46/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I begin with the business: Silicon Motion designs NAND flash controllers for SSDs, eMMC and UFS storage. That is a focused semiconductor niche serving PCs, mobile devices and data centers, and it requires technical know-how. In the latest reported quarter, fiscal Q2 2026, revenue was $451.0 million and net income was $136.1 million, producing a 30.18% net margin. Those are strong current results, and the balance sheet is conservative: debt-to-equity is 0.07, with a FairStock Altman Z-Score of 6.78. FairStock calculations show ROE at 31.57%, though ROCE is only 10.15%, a reminder that reported equity returns can be flattered. At the 2026-10-13 close of $246.63, the FairStock P/E is 28.85 and P/B is 7.99. The FairStock Graham Number is just $38.54, so the margin of safety is negative 539.93%; I see no asset-based bargain. FairStock trailing free cash flow is negative $120.5 million, a -2.5% FCF yield, which is a real yellow flag. The FairStock Piotroski F-Score is 5/9, and the FairStock Score is 46/100. The PEG of 0.04 looks cheap only if the supplied growth rates persist, but FairStock's Lynch category is none because only 0 years of filed results exist and three are needed. I would want several years of durable revenue, margins and cash generation before treating today's price as justified.

In plain English: Silicon Motion makes controller chips that help phones, computers and data centers store data in flash memory. The latest quarter looked very strong, with healthy sales and profit, and the company carries very little debt. But the stock at $246.63 looks expensive relative to its accounting value, and the business is currently using more cash than it generates.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer