| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 43.01 | 39 |
| Intrinsic value (DCF) | 14.90 | -52 |
| Graham-Dodd Method | 6.88 | -78 |
| Graham Formula | 78.68 | 154 |
TES Touch Embedded Solutions (Xiamen) Co., Ltd. (003019.SZ) is a specialized JDM/ODM manufacturer focused on touchscreen and embedded display solutions. Founded in 2015 and headquartered in Taipei City, Taiwan, TES operates as a key player in the global touch technology ecosystem, designing and manufacturing products including open frame monitors, touch display modules, panel PCs, All-in-One systems, and digital signage solutions. The company serves diverse sectors such as smart retail, healthcare, financial services, industrial automation, and hospitality through its comprehensive product portfolio. TES's business model combines research and development with manufacturing excellence, positioning it as a critical supplier for businesses requiring customized touch interface solutions. Operating in the competitive Technology Hardware, Equipment & Parts sector, TES leverages its Taiwan-based R&D capabilities with manufacturing operations to deliver integrated solutions for global clients. The company's focus on embedded applications makes it particularly relevant in the growing IoT and smart device markets, where touch interfaces are becoming increasingly essential across industrial and commercial applications.
TES Touch Embedded Solutions presents a mixed investment profile with moderate financial performance in a highly competitive sector. The company maintains a conservative financial structure with a beta of 0.2 indicating lower volatility than the broader market, and demonstrates profitability with net income of CNY 188 million on revenue of CNY 2.21 billion. However, concerns include thin profit margins (approximately 8.5% net margin), negative capital expenditures suggesting potential underinvestment in growth, and modest operating cash flow relative to market capitalization. The dividend yield of approximately 1.2% provides some income appeal, but the company's small market cap of CNY 6.91 billion positions it as a niche player in the global touch solutions market. Investment attractiveness is tempered by the competitive pressures in the ODM/JDM space and the capital-intensive nature of the hardware manufacturing industry.
TES Touch Embedded Solutions operates in the highly fragmented and competitive touchscreen and embedded solutions market, where it faces pressure from both larger diversified electronics manufacturers and specialized touch technology firms. The company's competitive positioning is defined by its JDM/ODM business model, which allows it to offer customized solutions without bearing brand marketing costs, but also limits its margin potential compared to branded competitors. TES's Taiwan-based R&D provides technical expertise in touch technology, particularly in industrial and commercial applications where reliability and customization are critical. However, the company faces significant scale disadvantages compared to larger Chinese and Taiwanese electronics manufacturers who benefit from greater purchasing power and manufacturing efficiency. The competitive landscape is characterized by rapid technological evolution in touch interfaces, display technologies, and embedded computing, requiring continuous R&D investment to maintain relevance. TES's focus on specific vertical markets like smart retail, healthcare, and financial services provides some differentiation, but these segments are also targeted by larger competitors with broader product portfolios and global service capabilities. The company's moderate financial performance suggests it maintains a viable but not dominant position in its niche markets, with success dependent on maintaining technical expertise and cost competitiveness against both specialized peers and larger electronics conglomerates.