Every Monday, I share my first take on 2 to 3 attractive ideas.
As usual, if you want me to dig deeper into an idea, vote for it. Use the poll at the end of this email.
Siltronic AG (WAF GR)
About (31 Aug 2026)
Share price: EUR 79.00
Market capitalisation: EUR 2,370 mn (USD 2,754 mn)
Enterprise value (EV): EUR 3,356 mn (USD 3,899 mn)
Average daily volume (ADV): EUR 10 mn (USD 12 mn)
LTM P/B: 1.2x
We’ve talked before about the memory chip cycle, and how we are probably near the end of the shortage.
Where else can semiconductor investors look for opportunities?
Go upstream.
WAF is the world’s 4th largest semiconductor wafer maker.
While downstream players like Micron (MU 0.00%↑ US) and SK Hynix (SKHY 0.00%↑US) are enjoying shortages for many quarters already, WAF has only begun to see demand recovery.
Cyclical inflection?
Advance payments from customers has bottomed out at EUR 31 mn during Q4’25:
Demand seems to be recovering. Customers started pulling forward some orders, causing inventory days to fall in Q4’25:
Competitor GlobalWafers Co., Ltd. (6488 TT) reported +20% YoY revenue growth in July 2026:
Source: Globalwafers (2026)
Yet, sell-side consensus is expecting only +7% and -1% YoY revenue growth in Q3’26 and Q4’26.
Management reports volume recovery during the July 2026 earnings call:
Yes, volume-wise, we're doing extremely well. We see the loading progressing nicely…
Potential sale?
In 2020, GlobalWafers offered EUR 145 per share to take over WAF.
However, the deal fell through in January 2022. It failed to secure regulatory clearance from the German government.1
Such is the risk of cross-border M&A.
A takeover is not completely off the table. WAF’s largest shareholder, Wacker Chemie AG (WCH GR) has made public its desire to exit.2
If a suitable buyer approaches, a deal can likely be done. The German regulator will probably be more open to a European semiconductor player or PE firm.
Factors to focus on
Get more evidence on cyclical inflection
Tuas Limited (TUA AU)
About (31 Aug 2026)
Share price: AUD 2.05
Market capitalisation: AUD 1,124 mn (USD 806 mn)
Enterprise value (EV): AUD 587 mn (USD 421 mn)
Average daily volume (ADV): AUD 5 mn (USD 3 mn)
NTM P/E: 52x
My initial estimate suggests ~7% free cash flow yield on enterprise value. ~5% premium over Singapore 10y government bond yield. Looks attractive.
Good business, temporary headwinds: Despite smaller market share, TUA’s operating profit margin is 2x its competitor. The challenger telco is famous for their cost control.
IMDA, the regulator is investigating TUA over alleged unauthorised use of spectrum bands.
The worst case scenario looks manageable. The maximum fine will likely wipe out a year’s profits, but is only 4% of TUA’s cash.
Under-recognised growth: TUA has not moved into enterprise market yet.
I estimate enterprise customers can contribute an incremental revenue of SGD 25 mn. This will increase total revenue by ~15%.
Since my first take on TUA, the shares have fallen ~8%. No significant developments. It looks more attractive now.
Among all the ideas readers voted, TUA is the ‘best loser’.
I thought this deserves another chance.
Vote for the best idea
If you want me to dig deeper into an idea, vote for it.
Coming up next
I will look deeper into Elan Corporation (6099 JP) this week. This was the idea you voted the most interesting in my previous email.
In 2024, M3, Inc. (2413 JP) acquired 55% of Elan. It paid JPY 1,040 per share. This is ~39% higher than the share price today.
In August 2026, activist investor Oasis Management demanded M3:
Transfer, acquisition or suspension of part of the business
Significant change to dividend policy
Given the pressure, M3 may sell Elan to fund special dividends to its shareholders.
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Published by Andrew Wong, ACA, CFA
In case you missed it
Last week, I highlighted the opportunity I see in Nine Entertainment Co. Holdings Limited (NEC AU).
Netflix’s competitor in Australia and more, at only 10.7x P/E.
Nine: Hidden Asset, AI Beneficiary and A Takeover
[Shortlist] Nine Entertainment Co. Holdings Limited (NEC AU)
I showed how one small accounting change can fool analysts into thinking a company is much more profitable and cash-generative.
I highlighted two real companies with these issues.
The Trick That Fools Analysts
You’re an online retailer. You’re running heavy losses and burning through cash. Investors won’t touch you with a ten-foot pole.
Disclaimer
This publication is for informational, educational, and entertainment purposes only and does not constitute financial, investment, legal, or tax advice. The content herein is a record of my personal research and investment process, and all analysis, forecasts, and opinions expressed are solely my own.
I make no representation or warranty, express or implied, as to the accuracy, completeness, or timeliness of the information provided. The stock market is highly volatile, and my forecasts, estimates, and assumptions may prove incorrect.
I am not acting as your financial advisor or fiduciary. You should not rely on any information in this publication to make investment decisions. Under no circumstances will I be held liable for any direct, indirect, or consequential losses or damages arising from your reliance on the content of this publication.
At the time of publication, I do not hold any positions in TUA AU, either long or short. I hold shares in WAF GR. I may change my views, predictions, or personal portfolio positioning at any time without notice.