- UMS's 1Q25 revenue grew 7% y-o-y to S$57.6m, in line with our forecast, mainly due to the contribution of its new customer. PATMI was flat, partially due to the weaker US$.
- Going forward, we expect the contribution of its new customer to increase q-o-q as ramp up in production yields continues to improve.
New customer contribution kicking in.
- - Read this at SGinvestors.io -
- In addition, orders from its existing customer should also increase slightly for FY25. All in all, we expect revenue to improve q-o-q from 2Q25 onwards.
Weakening US$, not tariffs, may weaken margins.
- - Read this at SGinvestors.io -
- Tariffs are borne by its customers and only 12% of its revenue is from the US.
Maintain BUY.
- Management is targeting S$1.5m/week from its new customer by the end of 2025. Revenue from its existing customer should also grow slightly y-o-y. As a result, we maintain our BUY rating on UMS with a higher target price of S$1.19.
- Our UMS's target price is pegged to a higher 15x blended FY25/26E P/E from 14x P/E previously.
Brighter skies ahead.
- Read more at SGinvestors.io.
