Advanced Semiconductor Engineering Inc. (NYSE: ASX)

Advanced Semiconductor Engineering (ASE) helps chip makers wrap up production. The company is one of the world’s leading providers of semiconductor packaging services; it also designs and manufactures interconnect materials and provides front-end and final chip testing services through its subsidiary ASE Test. The company provides electronic manufacturing services through Universal Scientific Industrial (USI), and it owns ISE Labs, an engineering test services provider in Silicon Valley. Customers in the US account for about half of ASE’s sales. The company has more than 200 customers around the world; some of the largest include Broadcom, Microsoft, NVIDIA, and STMicroelectronics.

The company reported unaudited net revenue (Note 1) of NT$46,005 million for the first quarter of 2011 (1Q11), up 23% year-over-year while down 14% sequentially.  Net income for the quarter totaled NT$3,974 million, up from a net income of NT$3,395 million in 1Q10 and down from a net income of NT$4,870 million in 4Q10.  Diluted earnings per share for the quarter was NT$0.65 (or US$0.111 per ADS), compared to earnings per share of NT$0.57 for 1Q10 and diluted earnings per share of NT$0.80 for 4Q10.

ASX closed at $5.47, gained 1.30% on last trading day, with the 801,502 volume. It has 52-week low of $3.33 and high of $6.66. Previous Closing Price is below its 20 day moving average $5.48  and its 100 day moving average $5.82. It has an ongoing P/E of 10.60, which indicates that it seems highly undervalued. It is rated strong buy by and it has a price target of $6.79 in six months.

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