The global semiconductor shortage has created production disruptions in several industries, primarily consumer electronics and electric vehicles (EVs). However…
the Biden administration is considering invoking the Defense Production Act (DPA) to identify possible semiconductor chip hoarding and ease bottlenecks that have hindered U.S. car production and caused consumer electronics shortages. Furthermore, a new program, National Semiconductor Economic Roadmap (NSER), introduced by Arizona leaders to focus on improving American infrastructure and supply chains for the semiconductor industry, is projected to propel the growth of chip makers.
While the global chip shortage is expected to persist for some time because of lean inventory and production delays, the initiatives of governments worldwide to create a more secure supply chain should bode well for the industry in the long run.
Given this backdrop, quality under-the-radar semiconductor stocks Axcelis Technologies Inc. (ACLS – Get Rating) and Cohu Inc. (COHU – Get Rating) could be solid bets now.
Axcelis Technologies Inc. (ACLS – Get Rating)
ACLS is engaged in designing, manufacturing, and servicing ion implantation and other processing equipment used in the fabrication of semiconductor chips. The company offers high energy, high current, and medium current implanters for varied application requirements. In addition, it provides used tools, replacement parts, equipment upgrades, maintenance services, and customer training as part of its aftermarket lifecycle goods and services.
This month, ACLS announced shipments of the company’s full family of Purion SiC Power Series implanters to several leading power device chipmakers located in Asia and Europe. The systems will be utilized in high-volume SiC power device manufacture for the automotive, mobile, and IoT sectors.
For the second quarter ended June 30, 2021, ACLS’s revenue increased 19.8% from the year-ago value to $140.16 million. Its operating income grew 46.5% year-over-year to $23.9 million. The company’s net income surged 42.1% from the prior-year quarter to $18.91 million, while its EPS increased 41% from the year-ago value to $0.55.
The company’s EPS is expected to grow 82.2% year-over-year to $2.46 in the current year. In addition, analysts expect ACLS’ revenue to increase 31.8% in fiscal 2021. ACLS’s stock has gained 114% over the past year and 63.7% year-to-date.
ACLS’ POWR Ratings reflect this promising outlook. The company has an overall rating of B, which translates to Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
ACLS is also rated an A grade for Momentum, and a B for Value and Quality. Within the B-rated Semiconductor & Wireless Chip industry, it is ranked #17 of 97 stocks.
To see additional POWR Ratings for Stability, Growth, and Sentiment for ACLS, click here.
Cohu Inc. (COHU – Get Rating)
COHU operates internationally in the semiconductor test and inspection equipment and printed circuit board (PCB) test equipment industry. Additionally…
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