The semiconductor industry has grown markedly so far this year, thanks to immense federal and private investments amid continuing robust demand. Amid the current global chip shortage, which has been exacerbated by…
increased sanctions against Russia, semiconductor companies are ramping up production with the help of private and government investments and incentives. Last month, the European Commission passed a new European Chips Act to enable $17.11 billion in public and private investments through 2030. And last year, President Biden set aside $50 billion for semiconductor manufacturing and research.
The U.S.-based Semiconductor Industry Association (SIA) has reported that global semiconductor industry sales hit a record $555.90 billion in 2021, registering a 26.2% surge year-over-year. Global semiconductor sales totaled $50.70 billion in January 2022, up 26.8% year-over-year. The bullish sentiment surrounding the industry is evidenced by the iShares Semiconductor ETF (SOXX), which has gained 13.7% over the past year.
Given the backdrop, we think it could be wise to invest in the quality small-cap semiconductor stocks Camtek Ltd. (CAMT – Get Rating) and SMART Global Holdings, Inc. (SGH – Get Rating), which possess promising growth prospects.
CAMT develops, manufactures, and sells inspection and metrology equipment and provides software solutions. It is headquartered in Migdal HaEmek, Israel. The company serves primarily the advanced packaging, memory, complementary metal-oxide-semiconductor (CMOS), image sensors, radiofrequency, micromechanical sensors (MEMS), and other semiconductor industry segments. CAMT sells its products in Asia Pacific, the U.S., and Europe. It has a market capitalization of $1.43 billion.
Last month, CAMT received orders totaling approximately $20 million from two leading Tier-1 IDMs. The orders are for the Advanced Interconnect Packaging, which is the company’s current growth driver. The Advanced Interconnect Packaging market is expected to grow with complex packaging technologies, such as Heterogeneous Integration, which supports the most challenging applications. This reflects CAMT’s business growth and profitability.
In its fiscal year 2021 fourth quarter, ended Dec. 31, 2021, CAMT’s revenue increased 52.7% year-over-year to $74.20 million. Its gross profit grew 61.5% year-over-year to $37.76 million. The company’s operating income grew 127.2% year-over-year to $20.93 million, and its net income increased 123.9% from the prior-year period to $19.68 million. CAMT’s net income per share rose 104.8% from its year-ago value to $0.43.
The $75.60 million consensus revenue estimate for its fiscal year 2022 first quarter, ending March 31, 2022, represents 31.8% year-over-year growth. The $0.43 consensus EPS estimate for the current quarter indicates a 29.6% year-over-year rise from the prior-year period. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in each of all the trailing four quarters.
Shares of CAMT increased 8.4% in price over the past year and closed yesterday’s trading session at $31.94.
CAMT’s POWR Ratings reflect this promising outlook. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.
CAMT has a grade of B for Sentiment, Momentum, and Quality. Within the A-rated Semiconductor & Wireless Chip industry, it is ranked #54 of 97 stocks.
To see additional POWR Ratings (Stability, Growth, and Value) for CAMT, click here.
SGH designs, manufactures, and distributes specialty solutions for the computing, memory, and LED markets in the U.S., Brazil, China, Europe, and internationally. The Cayman Islands company operates through three segments: Memory Solutions; Intelligent Platforms Solutions; and LED Solutions. It offers dynamic RAM modules, supply chain services, Penguin Computing solutions, Penguin Edge solutions, LED solutions, hardware, and software products. SGH has a market capitalization of $1.30 billion.
On Feb. 16, 2022, SGH introduced its new…
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