Nepes Ark specializes in the wafer and package testing part of system-semiconductor (non-memory) back-end processing, checking whether a chip works as designed; it was spun off from parent Nepes to house the test business, and its results turn on test demand for system chips such as DDIs, PMICs and MCUs. The center of the recent story is two new facility-investment disclosures, read as pre-emptive spending to expand capacity, while a March disclosure of a change in profit structure formalized the swing from loss to profit, and the May 15 quarterly report confirmed the first-quarter recovery. What stands out recently is that the recovery is fast, with cumulative first-quarter operating profit surpassing the whole of last year, and a recent price pullback has brought the forward P/E in line with the sector forward median (28.99x); on the other hand, with an ROE of 2.0% and interest coverage of 1.03x this is still early in the recovery, so whether the added capacity translates into utilization and profit, and whether earnings stack up for another quarter or two, is the crux.
At-a-glance assessment financial health · growth · profitability · valuation
- Revenue fell 4.3% year over year (3-year trend: falling).
- Net profit swung from a loss a year earlier back into the black (a turnaround).
- Most recent quarter (Q1 2026) revenue was 3.3% higher than a year earlier.
- ROE is 2.0% (total-net basis). It is above the sector average.
- Operating margin is 4.2%.
- The P/E sits above the sector median, reflecting elevated expectations.
Ownership & governance As of 2025-12-31
Largest shareholder Nepes 37.22% (corporate)
Controlling bloc incl. related parties 37.22%
With the controlling bloc holding 37%, the ownership structure is stable.
🔎 In-depth analysis
- Nepes Ark specializes in the test part of system-semiconductor (non-memory) back-end processing.
- Revenue comes from wafer testing and package testing, which check whether a chip works as designed, and from the test interfaces (probe cards, test boards and the like) used in testing.
- Because it was set up by carving the test business out of parent Nepes, its results turn on test demand for system chips such as display driver ICs (DDIs), power management ICs (PMICs) and microcontrollers (MCUs).
- Rather than making chips itself, it takes on the final gate that guarantees quality before a chip goes to market, earning money from test fees.
- The latest close is ₩34,850 and market capitalization is ₩424.6 billion.
- The price sits below its 20-day line (₩41,768) and its 60-day line (₩40,097).
- Trading below both its short- and mid-term moving averages, the trend is on the soft side.
- The RSI (a supplementary gauge that weighs 14-day up-strength against down-strength on a 0-100 scale) is 43.9, a neutral level.
- The one-month change is -15.6%, the three-month change is +23.1%, and the price sits -39.6% below its 52-week high.
- Relative strength versus the KOSDAQ is 94 (on a 1-99 scale that converts trailing one-year return versus the index with heavier weight on recent performance; higher means stronger than the market), placing it in roughly the top 5% of all stocks by strength.
- Over the past three months it led the index by 60.8%.
- Chart reading is best done alongside volume and disclosure dates.
- On confirmed 2025 results, the P/E (how many times one year's net profit the price represents) is 124.29x, well above the sector median of 51.94x, so it looks high.
- But this comes right after a swing from loss to profit, when net profit (₩3.4 billion) is still small in absolute terms, so the multiple is heavily inflated; for a company at an earnings inflection, the trailing P/E is hard to take at face value.
- In fact, the forward P/E on this year's earnings comes down to about a quarter of last year's figure, because this year's earnings are seen rising sharply, and at that level it sits broadly in line with the sector's forward P/E median (28.99x).
- The P/B (how many times net assets) is 2.52x and the forward P/B is 2.52x, above the sector median (1.23x) but in a range comparable to quality materials and components names.
- ROE (how much it earns in a year on equity) is 2.0%, still early in the recovery, and the debt ratio (debt to equity) is 172.9%, about average.
- A current ratio of 283.7% leaves ample capacity to meet short-term obligations, and interest coverage of 1.03x means operating profit has just cleared interest expense, a level that would improve quickly as earnings build.
- Over five years, revenue moved from ₩114.2 billion in 2021 to ₩153.9 billion in 2022, ₩122.9 billion in 2023, ₩119.3 billion in 2024 and ₩114.1 billion in 2025, easing off for a while after the 2022 peak.
- Earnings moved more dramatically.
- Operating profit passed through losses in 2023-2024 before turning to ₩4.8 billion in 2025, and net profit swung from large losses in 2023-2024 to a positive ₩3.4 billion in 2025.
- The heart of the recovery is this year's first quarter.
- Q1 2026 revenue was ₩29.9 billion (+3.3% year on year), yet cumulative operating profit already reached ₩5.0 billion, surpassing the whole of last year's operating profit (₩4.8 billion) in a single quarter.
- In other words, with revenue similar, profit rose sharply, meaning utilization is climbing and profitability is recovering fast.
- That said, since some past quarters carried losses, whether the first quarter's good profitability continues in the remaining quarters is something to confirm with further quarterly results.
- The center of the recent flow is two new-facility-investment disclosures (April 3, 2026 and May 26, 2026).
- In back-end testing, adding equipment leads straight to expanded capacity (processing capability), so this can be read as pre-emptive spending premised on a demand recovery.
- Early in the investment, however, depreciation can rise first, so there is a lag before the expansion shows up in profit.
- The March 11, 2026 disclosure of a change of 30% or more in revenue or profit structure formalized the shift from loss to profit, and the May 15, 2026 quarterly report (as of March 2026) is the primary basis confirming the first-quarter recovery.
- All are facts confirmed in the original official filings.
- The strengths are clear.
- Having passed through a two-year loss tunnel, the company swung back into the black in 2025, and its recovery is fast enough that cumulative first-quarter 2026 operating profit surpassed the whole of last year in a single quarter.
- On top of that, capacity-expansion spending continues, preparing for a demand recovery.
- On valuation, the P/E on last year's results looks high because of the small early profit after the swing, but a recent price pullback has brought the forward P/E on this year's earnings down in line with the sector forward P/E median (28.99x), and the forward P/B is 2.45x, so allowing for the earnings inflection it is hard to call the price excessively expensive.
- The point to watch is the durability of the recovery.
- An ROE of 2.0% and interest coverage of 1.03x are still early-recovery figures, so whether earnings stack up for another quarter or two and firm up is the crux.
- In short, if system-chip test demand continues and the added capacity translates into utilization and profit, the scope for earnings improvement widens; conversely, if quarterly profit wobbles again, the pace of recovery slows.
🔎 Valuation vs peers Inconclusive
We take Doosan Tesna, whose business substance (system-semiconductor back-end testing) is closest, as the core peer, with quality semiconductor materials and components names (Hana Materials, Soulbrain) as a reference set for profitability.
| Peer | P/E | P/B | ROE |
|---|---|---|---|
| Doosan Tesna | 1161.33x | 4.01x | 0.35% |
| Hana Materials | 26.13x | 2.16x | 8.28% |
| Soulbrain | 29.03x | 2.17x | 7.49% |
(a) Comparing P/E with Doosan Tesna, the closest business (system-chip testing), both have small early profits right after a swing to profit, so multiples spike into the hundreds to thousands, meaning P/E cannot separate them. On a P/B of 2.66x and ROE of 2.0%, in fact, the asset-based burden is lower than Doosan Tesna (P/B 5.12, ROE 0.4%). (b) The quality materials names (Hana Materials, Soulbrain) run ROE in the 7-8% range at a P/E of around 35x, so whether Nepes Ark's 2% ROE climbs to their level is the baseline for normalization. (c) The key is the limitation of last year's trailing P/E (131x). Right at the loss-to-profit inflection, the trailing multiple is overstated, and even though the price pullback has lowered the multiple, the forward can only be gauged via a DART seasonality approximation (2026 revenue of about ₩119.1 billion) since there is no official quantitative company guidance, making fair value hard to pin down. We therefore leave it Inconclusive.
Earnings outlook company-stated · verified
| Type | Period | Revenue | Operating profit | Net profit |
|---|---|---|---|---|
| Next quarter | Q2 2026 | approx. ₩32.6 billion | — | — |
Price history Close · MA20 · MA60
The latest close is ₩34,850 and the market capitalization is ₩424.6 billion. The price sits below its 20-day moving average (₩41,768) and below its 60-day moving average (₩40,097). It is under both its short- and medium-term moving averages, so the trend looks subdued. The RSI (a supplementary indicator that gauges the strength of gains versus losses over the past 14 days on a 0-100 scale) is 43.9, a neutral level. The one-month change is -15.6%, the three-month change is +23.1%, and the position relative to the 52-week high is -39.6%. Relative strength versus the KOSDAQ is 94 (on a 1-99 scale, converted from returns against the index over the past year with more weight on recent performance; higher means stronger than the market). It is stronger than roughly 95% of all stocks. Over the past three months it outpaced the index by 60.8%. Chart interpretation is best done alongside trading volume and the dates on which disclosures occur.
Relative performance stock vs index · start = 100
Excess return vs index · 3M +60.79% / 6M +128.04% / 12M +155.66%
Key metrics vs sector median
Valuation
The P/E of 124.29x is above the sector median (44.74x). The P/B of 2.52x is above the sector median (1.26x).
Enterprise value (EV)
EV = market cap + net debt. It reflects cash and debt, so it captures the real cost of the whole business that market cap alone misses; lower multiples are cheaper relative to earnings or sales.
Intrinsic value (DCF estimate)
DCF (discounted cash flow) estimate — discount rate 9.2%, initial growth 4.0%→terminal 2.0%, 10-yr forecast, free-cash-flow basis. A reference range that shifts materially with assumptions.
Profitability & financials
Return on equity (ROE) is 2.0%, in line with the sector average (2.0%). The operating margin is 4.2%. The debt ratio is 172.9%, so the financial structure is moderate.
Growth FY2025 · annual report (separate)
| Item | 2023 | 2024 | 2025 | YoY |
|---|---|---|---|---|
| Revenue | $81.5M | $79.0M | $75.6M | -4.34% ↓ slower |
| Operating profit | $453,252 | -$1.7M | $3.2M | — |
| Net profit | -$20.1M | -$19.0M | $2.3M | — |
| 5-year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $75.7M | $102.0M | $81.5M | $79.0M | $75.6M |
| Operating profit | $17.8M | $14.9M | $453,252 | -$1.7M | $3.2M |
| Net profit | $16.3M | $17.0M | -$20.1M | -$19.0M | $2.3M |
| Revenue CAGR | 4-yr avg -0.03% | ||||
Revenue fell 4.3% year over year (2023 ₩122.9 billion → 2024 ₩119.3 billion → 2025 ₩114.1 billion), and the three-year trend is 'falling'. The rate of decline widened from the prior year. Over the 5 years on record, revenue compound annual growth (CAGR) is -0.0%. The two-year revenue CAGR is -3.7%. In the most recent quarter (Q1 2026), revenue was 3.3% higher than the same period a year earlier.
Latest quarterly results Q1 2026 · vs year-ago
Technical indicators
What stands out
- —
Points to watch
- Revenue fell 4.3% year over year (3-year trend: falling).
- The price is high versus peers, so expectations already appear priced in.
Recent news & events searched · sourced
- 2026-05-26FilingNew facility-investment decision (equipment spending tied to back-end test capacity)Short term: possible depreciation burden early in the spend. Medium term: expanded processing capability on a demand recovery, supporting revenue and utilization. Source
- 2026-05-15EarningsQuarterly report (as of March 2026) filed - Q1 revenue of ₩29.9 billion, cumulative operating profit of ₩5.0 billionQ1 revenue +3.3% year on year, with cumulative operating profit exceeding the full-year 2024 figure. The primary basis confirming the recovery. Source
- 2026-04-03FilingNew facility-investment decision (equipment spending)The first of two successive expansion decisions. Read as pre-emptive capacity spending premised on a demand recovery. Source
- 2026-03-11FilingChange of 30% or more in revenue or profit structure - swing from loss to profit formalizedOfficial confirmation of the shift from the large 2024 loss to 2025 profit. The starting point of the turnaround story. Source
Figure cross-check computed ↔ external
Recent filings
- 2026-05-26Disclosure
- 2026-05-15PeriodicQuarterly report
- 2026-04-14OwnershipOfficers'/major-shareholders' holdings report
- 2026-04-03Disclosure
- 2026-03-26Disclosure
- 2026-03-26Shareholders' meeting notice
- 2026-03-18PeriodicAnnual business report
- 2026-03-18Audit report
- 2026-03-11Disclosure
- 2026-03-11Shareholders' meeting notice
- 2026-03-11EarningsEarnings filing
- 2026-03-11Shareholders' meeting notice
📖 Plain-language glossary — expand if you are new to this
- P/E
- How many times a year's net profit the price is worth (lower is cheaper relative to earnings). The P/E here is on trailing (last full-year) results; for companies whose earnings swing fast (memory chips and other cyclicals/high-growth), a forward P/E on this year's expected earnings is more accurate.
- P/B
- Price relative to net assets (equity). Around 1x means it trades near book value; below 1x means below book.
- P/S
- Price relative to a year's revenue — useful for growth companies with thin earnings.
- Net debt / EV
- Net debt = interest-bearing debt − cash. Negative means more cash than debt (net cash). EV (enterprise value) = market cap + net debt, closer to what it would cost to buy the whole business.
- EV/EBIT · EV/EBITDA · EV/Sales
- Enterprise value against operating profit (EBIT), EBITDA, or revenue. Unlike P/E these reflect debt and cash; lower is cheaper relative to earnings power or sales.
- FCF / FCF yield
- Free cash flow = operating cash − capex, the cash actually left over. FCF yield = FCF ÷ market cap; higher means more cash generated per unit of market value.
- Intrinsic value (DCF)
- Future free cash flow (or, for some capex-heavy but profitable names, forecast earnings) discounted to today to estimate per-share value. Because it shifts a lot with the discount-rate and growth assumptions, it is shown as a bear/base/bull range, and the basis and assumptions are disclosed in one line beneath it.
- ROE
- How much profit the company earns in a year on its equity (%). Higher means better returns on capital.
- EPS / BPS
- Earnings per share / net assets (book value) per share.
- Operating / net margin
- Profit left from the core business / final profit after tax and interest, per unit of revenue.
- Debt ratio
- Debt relative to equity (%). Higher means more reliance on borrowing (norms vary by sector).
- Current ratio
- Assets convertible to cash within a year against debt due within a year. Above 100% leaves some short-term headroom.
- Interest coverage
- How many times operating profit covers the interest owed. Below 1x means operating profit alone struggles to cover interest.
- Dividend yield / payout ratio
- The year's dividend as a % of today's price / the share of earnings paid out as dividends.
- Revenue CAGR
- Multi-year growth expressed as a single yearly average (compound annual growth rate).
- RSI (short-term signal)
- Whether recent price action is overheated or beaten down. Above 70 is overbought, below 30 oversold.
- MA20 / MA60 (moving averages)
- The 20- and 60-day average price. Price above them signals a firmer short-term trend.
- vs 52-week high
- How far below the past year's peak the price sits now (%).
All figures are for reference only; how they read varies by sector and over time.
Sources: Korea FSC market-price API (data.go.kr), OpenDART, KRX/KIND — public data only.
Bong Stocks presents public-data-based information for reference only. It is not investment advice and contains no target prices, ratings, or buy/sell recommendations. Verify independently before making any decision.