Infineon IFX.DE
What does Infineon do?
Infineon develops, manufactures and sells semiconductors and semiconductor-based solutions, with a focus on power electronics, microcontrollers, sensors and security solutions. The company, based in Neubiberg near Munich, is one of the large European semiconductor manufacturers and supplies customers worldwide, including in Europe, Asia and North America.
Revenue arises in several segments. The automotive business supplies microcontrollers, power semiconductors, sensors and memory chips for assistance and safety systems, powertrains, comfort electronics and infotainment. The Green Industrial Power segment offers IGBTs as well as silicon carbide devices and modules for power generation, power transmission, industrial drives and household appliances. Other areas cover power supplies and sensor solutions as well as connected security solutions. Competitively, Infineon is strongly positioned above all in power semiconductors and automotive chips and competes with other international providers from Europe, the United States and Asia.
Score profile
Rank vs. Semiconductors (40 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, Infineon ranks in the middle in the group Semiconductors (4.2/10). On growth, the company ranks in the middle in the group Semiconductors (4.4/10). On valuation (higher = cheaper), the stock ranks above average in the group Semiconductors (7.3/10). On financial strength, Infineon ranks in the middle in the group Semiconductors (4.2/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 12.8x | 18.7x | better than 86 % |
| Trailing P/E | 53.3x | 42.4x | better than 36 % |
| PEG ratio | 0.4x | 0.8x | better than 74 % |
| EV/EBITDA | 16.5x | 21.3x | better than 62 % |
| Price/sales | 4.1x | 5.8x | better than 69 % |
| Price/book | 3.7x | 5.1x | better than 60 % |
| Revenue growth | 12.6% | 25.5% | better than 31 % |
| Earnings growth | 39.6% | 7.4% | better than 57 % |
| Gross margin | 41.1% | 53.3% | better than 29 % |
| Operating margin | 14.2% | 15.5% | better than 46 % |
| Net margin | 7.8% | 10.3% | better than 46 % |
| Return on equity | 7.0% | 8.6% | better than 46 % |
| Debt/equity | 40.2% | 36.5% | better than 44 % |
| Current ratio | 1.7x | 3.3x | better than 14 % |
| Free cash flow yield | 2.7% | 1.3% | better than 68 % |
| Dividend yield | 0.7% | 1.2% | – |
| Payout ratio | 38.0% | 38.0% | – |
| Beta | 1.95 | 1.92 | – |
Valuation: what is Infineon worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give Infineon a model range of 20.36 EUR to 71.72 EUR per share.
24 analysts, average rating “Buy”, average price target 85.88 EUR (+75.1%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- Demand from the automotive industry for semiconductors rises with increasing electrification, assistance systems and a growing electronics content per vehicle.
- Investment in renewable energy, power grids and energy-efficient industrial drives drives sales of power semiconductors.
- Technological leadership in silicon carbide and power electronics, as well as utilization of the company's own manufacturing, influence margins and earnings.
Risks
- The semiconductor industry is cyclical, so demand fluctuations and inventory reductions at customers can heavily weigh on revenue and capacity utilization.
- High investment in manufacturing capacity ties up capital and increases pressure on margins and cash flow when demand is weak.
- Trade restrictions, geopolitical tensions and growing competition, particularly from Asia, can affect sales markets and prices.
What to look for with Infineon
The segment margin shows how profitably Infineon operates in each business area and how well its capital-intensive manufacturing is utilized across the economic cycle.