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Avacoco · 083930 · Machinery

Avacoco: Sharp Drop in Trailing Operating Margin After Strong 2024-2025, Shares Near Book Value

Why this report

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Avacoco, a KOSDAQ machinery company with a market value of ₩178.2B, saw trailing 12-month operating margin fall to 1.5% from 8.8% in 2025, while net income was lifted to ₩15.6B. The shares trade at 0.9x book value and 11.4x earnings, close to a model estimate of ₩11,926 per share against a ₩12,140 close.

Written Oct 29, 2026 · Data as of Oct 28, 2026 · 0 views

This is not financial advice. The report does not recommend buying or selling anything.

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Thesis

The data supports a company that grew revenue strongly in 2024 and 2025 and that trades at about book value with a 4.1% dividend yield. It does not support a clean earnings-recovery story: trailing operating income of ₩3.6B is far below net income of ₩15.6B, which suggests non-operating items are lifting the bottom line, though the data does not say what they are. The share price is up 26.7% over three months but down 24.7% over one year, and sits well below the 52-week high of ₩17,500. Filings show a change of largest shareholder on 2026-08-21 along with several holding reports, but the data does not explain the context. No news headlines are available.

Business overview

Avacoco is a machinery company listed on KOSDAQ since 2005-10-11 and founded in 2000, with 14,677,249 listed shares. Annual revenue rose from ₩179.8B in 2021 to ₩392.9B in 2025, with a dip to ₩186.9B in 2023 (-14.0%). Growth was 63.5% in 2024 and 28.6% in 2025. Trailing revenue to H1 2026 is ₩239.1B. A major sales or supply contract filing was amended on 2026-10-13; the data does not give its size or terms.

Financial analysis

From filed financial statements: 2025 revenue was ₩392.9B, operating income ₩34.6B (8.8% margin), net income ₩28.7B and ROE 13.5%. In 2024 operating income was ₩21.1B (6.9% margin) and net income ₩26.4B. In 2023 the margin was only 2.4% and ROE 2.4%. Trailing figures to H1 2026 show operating income of ₩3.6B (1.5% margin), net income of ₩15.6B (6.5% margin) and ROE of 7.8%. The balance sheet shows liabilities at 103.1% of equity, cash of ₩27.2B, borrowings of ₩19.1B and free cash flow of ₩8.7B.

Valuation

The shares trade at 11.4x earnings, 0.9x book, 0.7x sales and 31.0x EV/EBITDA, with a 4.1% dividend yield and enterprise value of ₩169.9B. Year-end P/E was 7.0x in 2025 and 6.7x in 2024, and P/B was 0.9x in both years, so the current P/E is higher than recent year-ends while P/B is unchanged. The listed peers (Doosan Enerbility, Hanmi Semiconductor, Jusung Engineering, Rainbow Robotics, EO Technics) are far larger and trade at P/E of 47.5x to 4,610.6x and P/B of 4.8x to 59.1x, so they are of limited use as a comparison. The discounted cash flow model, using a 7.4% rate on trailing data to H1 2026, gives a model estimate based on the assumptions shown of ₩11,926 per share in the base case, ₩3,618 in the bear case and ₩26,894 in the bull case. The close of ₩12,140 is slightly above the base case, and the wide range shows high sensitivity to assumptions.

Catalysts

  • The amended major sales or supply contract filing on 2026-10-13 may matter, but its details are not in the data.
  • The H1 2026 report filed on 2026-08-14 showed the weaker trailing operating margin, so the next results will show whether margins recover.
  • The change of largest shareholder filed on 2026-08-21 and related 5%+ holding reports could affect governance and control.
  • Insider shareholding reports and trading plan reports for executives and major shareholders were filed in July and August 2026.
  • Foreign ownership slipped to 5.2% from 5.5% sixty days earlier, and 20-day flows were small, with foreigners net sellers of about ₩0.6B and retail net buyers of about ₩0.6B.

Risks

  • Trailing operating margin of 1.5% is well below the 8.8% reported for 2025, and earnings quality is unclear because net income is far above operating income.
  • Revenue has been volatile, falling 14.0% in 2023 after a 20.8% rise in 2022, and the trailing figures suggest 2026 may be weaker than 2025.
  • The model range of ₩3,618 to ₩26,894 per share shows how uncertain the cash flow assumptions are.
  • Liabilities of 103.1% of equity and ₩19.1B in borrowings add financial leverage, although cash is ₩27.2B.
  • The change of largest shareholder adds uncertainty about control, and the data gives no detail on its effect.

Closing view

The data shows a company that nearly doubled revenue between 2023 and 2025, with a recent drop in trailing operating profitability. It trades near book value with a dividend yield of 4.1%, and the share price is close to the model's base-case estimate, so the market appears to price in neither a full recovery nor a deep decline. The lack of news and the missing details on the contract and ownership change leave key questions open. Whether margins return toward 2025 levels is the main thing the next filings will show.

Model estimate of fair value

Bear
₩3,618
-70%
Base
₩11,926
-1%
Bull
₩26,894
+124%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Base case of the 5-year discounted cash flow model on the stock's Valuation tab (statements TTM to H1 2026; discount rate 7.4%). Bear and Bull move the main assumptions by fixed steps. See and change the assumptions

Filings and data used

Report history

  1. Oct 29, 2026InitiationStart of coverage (reader request)Avacoco: Sharp Drop in Trailing Operating Margin After Strong 2024-2025, Shares Near Book Value

Built only from jonbur's own data: prices and investor flows, filed financial statements and filings, and news headlines. Disclosed (filed) data is labelled as such. Written by AI and may contain mistakes.

This is not financial advice. The report does not recommend buying or selling anything.

Source: KRX statistical information