3 interesting FK's I've decided not to invest in: UMC, STM, MKSI


All of them in the semi industry. By the fundamentals they look good. A good discount to last year. Good earnings, low debt, etc.

But looking at the long term 20y + it seems when these companies go out of favour, they REALLY go out of favour and we may only be in the early months of that process [1].

I don’t have any insight into any of them compared to industry professionals, so I have no edge except value investing.

I don’t know how much confidence to have in their earnings in the next few years.

MKSI just did a big acquisition I think and debt jumped up, at a not-so-great time. UMC has ‘taiwan risk’.

The US market is still quite high (SP380) vs what I would consider fair value (SP320-330), so that’s a headwind too.

Decision: not tempting enough.

[1] excuse the pun