GlobalFoundries: This Is Not The AI Winner You're Looking For

Passage Research5.46K FollowersFollow5ShareSavePlay(14min)CommentsSummaryGlobalFoundries receives a Sell rating due to overextended valuation and lackluster near-term growth despite AI-related demand.GFS's diversified end-market exposure, especially 39% SMD, limits its ability to capture AI-driven upside compared to peers.Silicon photonics could add $1 billion in revenue by 2028, but most growth projections appear optimistic and are not yet reflected in results.At 14.5x EV/EBITDA and 36x forward earnings, GFS trades at a premium not justified by its slower growth and mixed financial profile. Sundry Photography/iStock Editorial via Getty Images GlobalFoundries (GFS) is one of the most interesting stories in semis right now as the narrative has really moved from a cyclical recovery to highly constrained supply for voracious end market demand. AsThis article was written byPassage Research5.46K FollowersFollowPassage Research focuses on identifying variant perception through a blend of fundamental analysis and alternative data. The research process combines detailed financial modeling with real-time datasets to underwrite earnings power, margin durability, and forward expectations.The author has spent over a decade on Wall Street, most recently spending the last five years working in the hedge fund industry as an analyst. Typical coverage spans consumer, TMT, industrials and special situations, with an emphasis on asymmetric risk/reward and catalyst-driven opportunities.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Short position through short-selling of the stock, or purchase of put options or similar derivatives in GFS over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.