New stock market guru serenity (@aleabitoreddit) just disclosed his new investment in $XFAB, a German-based professional foundry with a market capitalization of $1.28 billion, specializing in analog chips, SiC, and silicon photonics. Let's break down his investment rationale: Core argument: The market is underestimating a potential NVIDIA manufacturing partner. X-FAB leads the EU-funded photonixFAB consortium project (€48 million), with NVIDIA participating as an application development partner, currently evaluating the high-volume manufacturing feasibility of its silicon photonics platform. In June 2025, NVIDIA hosted the consortium's fifth meeting in Denmark. This relationship has not yet been incorporated into valuation models by mainstream sell-side analysts. Valuation at a historical low. Currently, the P/B ratio is approximately 1.29x, and the P/S ratio is approximately 1.6x, significantly lower than comparable professional foundries with growth catalysts (typically 3-5x). The valuation discount primarily stems from the automotive business accounting for approximately 61% of revenue, which is affected by industry cycles. Two other growth drivers: > XFAB is currently the only high-volume SiC foundry in the US, and POWI has a wafer supply agreement with it that is filed with the SEC. > The EU Chips Act has allocated €128 million, and the US Chips Act has added $50 million; EU Chips Act 2.0 is underway, with photonics as a key focus, and XFAB is already a member of the European Photonics Chip Industry Steering Committee. Key risks: The collaboration with NVIDIA is still in the evaluation stage and has not yet entered mass production confirmation. The duration of the downturn in XFAB's automotive business is uncertain. The core issue is whether the growth rate of the photonics and SiC businesses can outpace the drag on cash flow from the automotive business.

X-FAB Silicon Foundries, headquartered in Germany, operates six wafer fabs in France, Germany, Malaysia, and the United States, employing approximately 4,500 people and generating annual revenue of approximately $815 million. It went public on Euronext Paris in 2017. A professional analog/mixed-signal chip foundry, its automotive revenue accounts for approximately 61%—cyclical downturns are the root cause of its depressed valuation, and also what Serenity considers a buying opportunity.

Following Serenity's position holdings and shill today, $XFAB saw a surge of up to 80% during the European session before pulling back; it is currently up 30%.