King Slide was founded in 1986 and is headquartered in Taiwan. It develops and commercializes medicines for rare diseases. Key products include FIRDAPSE for LEMS, FYCOMPA for epilepsy, and AGAMREE for Duchenne Muscular Dystrophy. FIRDAPSE treats LEMS, FYCOMPA treats seizures, and AGAMREE is a corticosteroid for DMD.

King Slide delivered exceptional Q3 25 performance, with revenue rising to TWD 4.4bn (about $140m), up 69.4% y/y, driven by continued margin expansion and operational efficiency improvements. EBIT surging to TWD 3bn, up 84.5% y/y. In addition, net profit soared 178.3% y/y to TWD 3.2bn.

The company's strong profitability metrics demonstrate effective cost management and pricing power across its diversified product portfolio spanning furniture hardware, server rail kits, and precision metal components. This exceptional Q3 performance underscores King Slide Works' competitive positioning and sustained momentum across its global markets in Taiwan, America, and China.

EBIT margin marvel

King Slide posted robust performance over FY 21-24, achieving a revenue CAGR of 16.9%, reaching TWD 10.1bn, driven by diversified product portfolio. EBIT registered a CAGR of 30.9% to TWD 6.1bn, with margins expanding from 42.9% to 60.2%.

Over FY 21-24, FCF rose 10 times to TWD 3.0bn, supported by cash from operations rising from TWD 1.5bn to TWD 5.2bn. Cash and cash equivalent also rose from TWD 7.9bn to TWD 17.5bn.

In comparison, Auras Technology Co., Ltd., a local peer, reported a lower revenue CAGR of 3.4% over FY 21-24, reaching TWD 15.8bn. EBIT increased at a CAGR of 11.5% to TWD 1.9bn, with margins expanding from 9.7% to 12.1%.

Looking ahead, consensus estimates an EBIT CAGR of 46.5%, reaching TWD 19.2bn, with a margin expansion from 60.2% to 70.4% over FY 24-27. Net income is projected to rise at a CAGR of 33.3%, reaching TWD 14.6bn. In comparison, Auras Technology's EBIT is estimated to increase at a CAGR of 57%, with net income set to rise at a CAGR of 42.6%.

Dividend delight

Over the past 12 months, the company's stock delivered returns of approximately 142.0%. In comparison, Auras Technology’s stock delivered significantly lower returns of around 33.0% over the same period. The company paid an annual dividend of TWD 32.2 in FY 24, resulting in a dividend yield of 2.1%.

King Slide is currently trading at a P/E of 39.6x, based on the FY 25 estimated EPS of TWD 94.4, which is higher than its 3-year historical average of 22.1x and Auras Technology’s valuation of 30.8x. The company is currently trading at an EV/EBIT multiple of 28.3x, based on FY 25 estimated EBIT of TWD 11.8bn, which is lower than its 3-year historical average of 18.1x and Auras Technology’s 23.5x.

King Slide is liked by 10 analysts, with each having 'Buy' ratings for an average target price of TWD 4,597.5, implying 22.9% upside potential over the stock's current price.

Overall, King Slide's impressive financial performance, strong profitability metrics, and robust stock returns highlight its effective cost management and competitive positioning. With favorable analyst ratings and significant upside potential, the company is well-positioned for continued growth and success in its diverse global markets. However, the company faces financial, supply chain, credit, and investment risks, managed through hedging, automation, strategic customer selection, rigorous controls and finally compliance with international standards.