Diodes (DIOD) AI Stock Analysis

• Market Cap: $2.11B
• Dividend Yield: N/A
• Average Volume (3M): 525.93K
• Price to Earnings (P/E): 49.8
• Beta (1Y): 1.51
• Revenue Growth: -21.10%
• EPS Growth: -80.81%
• Country: US
• Employees: 8,593
• Sector: Technology
• Sector Strength: 45
• Industry: Semiconductors and Equipment
• EPS (TTM): 0.95
• Shares Outstanding: 46,333,930
• 10 Day Avg. Volume: 588,713
• 30 Day Avg. Volume: 525,934
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.61
• Price to Cash Flow (P/CF): 6.40
• P/FCF Ratio: 6.40
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $63.33
• Price Target Upside: 33.92% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

Diodes faces financial challenges with declining revenue and profit margins, though it maintains a strong balance sheet with low leverage. Technical indicators point to a bearish trend, and valuation suggests potential overpricing. The recent earnings call provides some optimism with growth in key markets and strategic initiatives in AI, but challenges in core markets and negative cash flow remain concerns. Overall, Diodes has potential, but significant risks and valuation concerns temper its stock score.

Positive Factors

Market Expansion

Diodes continues to see a gradual recovery in Asia, notably in China and the Southeast Asia region.

Product Development

New product releases continue to expand the TAM for Diodes.

Negative Factors

Regional Demand Weakness

Europe and North America demand remains weak.

Diodes Business Overview & Revenue Model

Company Description

Diodes, Inc. manufactures and supplies semiconductor products. It offers diodes, rectifiers, transistors, MOSFETs, protection devices, functional specific arrays, single gate, dual gate and standard logic, amplifiers and comparators, Hall-effect and temperature sensors. The firm operates through the following geographical segments: Asia, North America, and Europe. It also provides power management devices, including LED drivers, AC-DC and DC-DC switching, linear voltage regulators, and voltage references along with special function devices, such as USB power switches, load switches, voltage supervisors, and motor controllers. The company was founded on June 15, 1959 and is headquartered in Plano, TX.

How the Company Makes Money

Diodes Incorporated generates revenue through the design, manufacturing, and sale of a wide range of semiconductor products. The company sells its products directly to equipment manufacturers and indirectly through distributors in various sectors, including automotive, industrial, and consumer electronics. A key component of Diodes' revenue model is its broad and diversified product portfolio, which allows it to address multiple market segments and applications. Strategic acquisitions and partnerships also play a role in expanding its market presence and enhancing its technological capabilities, contributing to its overall earnings.

Diodes Financial Statement Overview

Summary

Diodes presents a mixed financial picture. The balance sheet reflects strong stability with low leverage and a solid equity ratio, while income statement figures show a declining trend in profitability and revenue. Cash flow performance is adequate but has seen a reduction in free cash flow, suggesting potential operational challenges. The company needs to focus on reversing revenue and profit margin declines to enhance financial health.

Income Statement

Diodes has experienced a significant revenue decline from 2022 to 2024, which is a concern in terms of growth. The gross profit margin stands at 33.2% for 2024, showing a decrease from previous years, impacting profitability negatively. The net profit margin has declined to 3.4% in 2024, indicating reduced efficiency in converting revenue to profit. EBIT and EBITDA margins have also decreased, reflecting operational challenges.

Balance Sheet

The company's balance sheet shows a strong equity position with an equity ratio of 75.2% in 2024, suggesting financial stability. The debt-to-equity ratio is extremely low at 0.6%, indicating minimal leverage and reduced financial risk. However, the return on equity has dropped to 2.5% in 2024, which could be a concern for investors seeking returns.

Cash Flow

Diodes' free cash flow has decreased in recent years, with a 2024 free cash flow of $119.4 million, down from $180.8 million in 2022. The operating cash flow to net income ratio is robust at 2.7, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio has decreased, reflecting challenges in maintaining cash flow growth.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.31B	1.66B	2.00B	1.81B	1.23B
	Gross Profit
435.86M	658.18M	827.24M	670.36M	431.12M
	EBIT
50.45M	250.57M	408.19M	275.99M	134.33M
	EBITDA
50.45M	420.96M	532.02M	444.47M	239.56M
	Net Income Common Stockholders
44.02M	227.18M	331.28M	228.76M	98.09M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
316.13M	325.63M	343.79M	370.14M	274.21M
	Total Assets
2.39B	2.37B	2.29B	2.19B	1.98B
	Total Debt
1.10M	98.36M	213.67M	301.02M	450.60M
	Net Debt
-307.57M	-217.10M	-123.06M	-62.58M	182.54M
	Total Liabilities
517.33M	557.98M	705.39M	891.77M	963.33M
	Stockholders Equity
1.80B	1.74B	1.51B	1.24B	963.82M
Cash Flow		Free Cash Flow
46.41M	130.15M	180.77M	197.35M	111.41M
	Operating Cash Flow
119.44M	280.91M	392.50M	338.54M	187.22M
	Investing Cash Flow
-118.04M	-158.32M	-265.26M	-144.23M	-106.77M
	Financing Cash Flow
-19.34M	-144.72M	-125.71M	-158.44M	-54.30M

Diodes Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 47.29
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DIOD, the sentiment is Negative. The current price of 47.29 is below the 20-day moving average (MA) of 51.46, below the 50-day MA of 56.58, and below the 200-day MA of 64.39, indicating a bearish trend. The MACD of -2.80 indicates Positive momentum. The RSI at 35.52 is Neutral, neither overbought nor oversold. The STOCH value of 22.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DIOD.

Diodes Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ADI	71 Outperform	$103.70B	68.96	4.43%	1.70%	-19.28%	-44.00%
MCHP	68 Neutral	$28.75B	105.40	4.71%	3.48%	-44.31%	-86.74%
NXPI	67 Neutral	$52.20B	21.23	28.16%	1.94%	-4.99%	-9.18%
ON	67 Neutral	$18.06B	11.80	18.97%	―	-14.19%	-27.42%
TXN	65 Neutral	$161.36B	35.89	28.25%	3.00%	-10.72%	-26.60%
DIOD	64 Neutral	$2.11B	49.80	2.49%	―	-21.10%	-80.81%
Sector *	58 Neutral	$21.35B	9.98	-18.95%	2.37%	5.03%	-22.66%

Diodes Corporate Events

Diodes Inc. Reports 5% Q4 Growth Amid Global Challenges

On February 11, 2025, Diodes Inc. reported its financial results for the fourth quarter of 2024, showing a 5% growth over the same quarter in 2023, reflecting improvements in the Asian markets, particularly China and Southeast Asia. Despite challenging global demand, Diodes maintained a 42% revenue mix from automotive and industrial sectors and is strategically focused on expanding in AI-related applications. The company anticipates a stronger 2025, having implemented cost-reduction measures and increased internal product qualifications to mitigate underloading costs.

Diodes Reports Q4 2024 Financial Results Amid Global Challenges

In the fourth quarter of 2024, Diodes Incorporated reported a revenue of $339.3 million, marking a 5% year-over-year growth compared to the same quarter in 2023. Despite challenging global demand conditions, especially in Europe and North America, Diodes maintained its product revenue mix in automotive and industrial sectors at 42%. The company continues to see strong momentum in Asia, particularly in China and Southeast Asia, and is focusing on growth in target markets and AI-related applications. While the fourth quarter GAAP net income fell to $8.2 million compared to the previous year, the company achieved $81.8 million in cash flow from operations, showcasing its financial resilience and strategic positioning for future growth.

Diodes Enhances Board with New Appointment

Diodes Incorporated announced the appointment of Dr. Huey-Jen Jenny Su to its Board of Directors, effective February 3, 2025. Dr. Su, an esteemed expert in environmental health, will enhance the board’s focus on corporate sustainability. Her appointment, alongside the retirement of Christina Wen-Chi Sung in May, reflects Diodes’ commitment to diversity and continued board development. This strategic move is expected to align with the company’s emphasis on fostering a safer and healthier workplace.

Diodes to Host Conference on 2024 Financial Results

On January 21, 2025, Diodes Incorporated announced plans to host a conference call on February 11, 2025, to discuss its financial results for the fourth quarter and fiscal year 2024. The call, featuring key company executives, reflects Diodes’ commitment to transparency and engaging with analysts and investors about its financial performance. This forthcoming discussion could have implications for stakeholders regarding Diodes’ operational strategies and market position.