AirTAC Earnings: No Major Surprise; Expect Stronger Linear Guide Sales in 2024

There is no major surprise in narrow-moat AirTAC’s 2023 results, with net profit up 16% year on year to TWD 6.97 billion. We raise our fair value estimate to TWD 960 from TWD 900 after rolling forward our estimates and incorporating the guidance given by management. We think the shares are fairly valued currently, with stronger sales of linear guide products in 2024 largely priced in. Our valuation for AirTAC implies a 2024 P/E ratio of about 23 times, versus its five-year historical trading range of around 17 times to 40 times.