United Microelectronics (NYSE:UMC) Shares Gap Down - Here's Why

Key Points

• United Microelectronics shares gapped down on Friday, opening at $19.84 after closing at $20.87 and later trading around $19.44, a drop of about 7.3%.
• Analyst sentiment remains weak: Wall Street Zen downgraded the stock to hold, while the broader consensus is a Strong Sell with an average target price of $8.60.
• The company recently raised its annual dividend to $0.4122 per share from $0.37, and its latest quarterly earnings beat EPS estimates even though revenue came in slightly below expectations.

United Microelectronics Corporation (NYSE:UMC - Get Free Report)'s stock price gapped down before the market opened on Friday . The stock had previously closed at $20.87, but opened at $19.84. United Microelectronics shares last traded at $19.4410, with a volume of 1,301,778 shares traded.

Analyst Upgrades and Downgrades

A number of research analysts have recently commented on the stock. Wall Street Zen cut shares of United Microelectronics from a "buy" rating to a "hold" rating in a report on Sunday, July 12th. BNP Paribas Exane reiterated an "underperform" rating on shares of United Microelectronics in a report on Thursday, May 28th. Finally, Weiss Ratings reissued a "hold (c)" rating on shares of United Microelectronics in a research report on Tuesday, May 26th. One equities research analyst has rated the stock with a Hold rating and three have issued a Sell rating to the stock. According to MarketBeat, United Microelectronics has an average rating of "Strong Sell" and a consensus target price of $8.60.

United Microelectronics Stock Down 7.3%

The company has a current ratio of 2.72, a quick ratio of 2.23 and a debt-to-equity ratio of 0.12. The firm has a market cap of $48.70 billion, a PE ratio of 29.52, a P/E/G ratio of 2.53 and a beta of 1.58. The business's 50-day simple moving average is $22.46 and its 200 day simple moving average is $14.72.

United Microelectronics (NYSE:UMC - Get Free Report) last posted its quarterly earnings results on Wednesday, April 29th. The semiconductor company reported $0.20 EPS for the quarter, beating the consensus estimate of $0.12 by $0.08. United Microelectronics had a net margin of 20.71% and a return on equity of 13.67%. The business had revenue of $1.91 billion during the quarter, compared to analyst estimates of $1.92 billion. As a group, equities research analysts expect that United Microelectronics Corporation will post 0.69 earnings per share for the current year.

United Microelectronics Increases Dividend

The company also recently announced an annual dividend, which will be paid on Thursday, August 6th. Shareholders of record on Wednesday, July 8th will be issued a $0.4122 dividend. This is a boost from United Microelectronics's previous annual dividend of $0.37. This represents a yield of 166.0%. The ex-dividend date is Wednesday, July 8th. United Microelectronics's dividend payout ratio is presently 49.23%.

Institutional Inflows and Outflows

Large investors have recently modified their holdings of the company. Dynamic Advisor Solutions LLC raised its stake in shares of United Microelectronics by 7.4% during the 2nd quarter. Dynamic Advisor Solutions LLC now owns 12,914 shares of the semiconductor company's stock valued at $351,000 after buying an additional 889 shares during the last quarter. CoreCap Advisors LLC lifted its holdings in United Microelectronics by 271.0% in the second quarter. CoreCap Advisors LLC now owns 1,369 shares of the semiconductor company's stock valued at $37,000 after acquiring an additional 1,000 shares during the period. Arrowstreet Capital Limited Partnership boosted its position in United Microelectronics by 0.8% in the 1st quarter. Arrowstreet Capital Limited Partnership now owns 129,895 shares of the semiconductor company's stock worth $1,166,000 after purchasing an additional 1,074 shares in the last quarter. Cetera Investment Advisers boosted its position in United Microelectronics by 7.7% in the 4th quarter. Cetera Investment Advisers now owns 15,472 shares of the semiconductor company's stock worth $122,000 after purchasing an additional 1,103 shares in the last quarter. Finally, Xponance LLC grew its stake in shares of United Microelectronics by 7.2% during the 4th quarter. Xponance LLC now owns 20,494 shares of the semiconductor company's stock worth $161,000 after purchasing an additional 1,384 shares during the period. Institutional investors own 5.05% of the company's stock.

United Microelectronics Company Profile

United Microelectronics Corporation (UMC) is a Taiwan-based semiconductor foundry that provides wafer fabrication and related manufacturing services to a global customer base. Founded in 1980, the company operates as a pure-play foundry, producing integrated circuits for a range of customers including fabless semiconductor companies and integrated device manufacturers. UMC is publicly listed NYSE: UMC and focuses on high-reliability manufacturing rather than branding consumer products.

UMC's core services encompass wafer fabrication using a portfolio of process technologies, with particular emphasis on mature and specialty nodes that support analog, power-management, radio-frequency (RF), and mixed-signal applications.

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