Amkor 'Underappreciated Beneficiary' of Advanced Semiconductor Packaging, BofA Says

02:16 PM EDT, 08/27/2026 (MT Newswires) -- Amkor Technology (AMKR) is an "underappreciated beneficiary" of the increasing complexity associated with semiconductor packaging, BofA Securities said Thursday. The brokerage initiated coverage of the semiconductor packaging giant's stock with a buy rating and a $70 price objective. "We see (Amkor) as an underappreciated beneficiary of rising semiconductor packaging complexity, (artificial intelligence/high performance computing-related) advanced packaging demand and US supply-chain regionalization," BofA analyst Ruplu Bhattacharya said in a note to clients. Amkor shares were up 5.4% in Thursday afternoon trade, bringing its year-to-date gains to 29%. The company continues to be a cyclical and capital-intensive provider of outsourced semiconductor assembly and testing services, BofA said. The market isn't fully reflecting Amkor's mix shift toward advanced products and the long-term strategic value of its upcoming expanded semiconductor facility in Arizona, according to the note. In May, the company announced it acquired an additional space next to its Arizona semiconductor campus as it expands advanced packaging and testing operations in the US. The facility is expected to assist Amkor in capturing advanced packaging business in the future from customers seeking to diversify their semiconductor supply chains, Bhattacharya said Thursday. The company's business is becoming "less transactional," while it should benefit from improved visibility into loading, reducing the risk associated with advanced-packaging assets being installed without identified demand, BofA said. The brokerage expects Amkor's annual earnings to reach $3.41 a share in 2028, compared with $1.51 in 2025, amid an expected improvement in mix and utilization. BofA also highlighted key risks to the company, such as high capital intensity, negative free cash flow through its investment cycle and advanced-packaging competition. Earlier this year, Amkor entered into a multiyear partnership with chipmaking giant Nvidia (NVDA) to develop advanced semiconductor packaging and test technologies for next-generation AI and accelerated computing platforms. Separately, Amkor signed a 10-year partnership with Taiwan Semiconductor Manufacturing (TSM) on advanced semiconductor packaging capabilities in Arizona. Price: 51.24, Change: +2.84, Percent Change: +5.87