United Microelectronics Corp. (UMC) has been trading in a large range this year and has recently moved into a smaller range where it has formed a resistance line and a level of support. If the stock breaks through either level, a big move is expected. Read more to learn how to take advantage of this trade.United Microelectronics Corp. (UMC) is the world's third- largest dedicated chip foundry, with a 7% market share. The company features a diverse customer base including Texas Instruments (NASDAQ:TXN), MediaTek, Qualcomm (NASDAQ:QCOM), Broadcom (NASDAQ:AVGO), Xilinx (NASDAQ:XLNX), and Realtek, supplying a wide range of products applied in communications, display, memory, automotive and more.
On Monday, the company reported its sales for June. Revenue came in at $17.3 million, which was a 18.9% year over year increase from the same month last year. In addition, the global chip shortage may provide the company an opportunity to gain market share from bigger players in the industry.
As of the most recent reported quarter, UMC had $4.4 billion in cash which compares very favorably to only $185 million in short-term debt. The company also has a solid net profit margin of 17.1%. In terms of growth, UMC has grown earnings an average of 34.3% per year over the past five years.