Seeking Alpha: Ultratech Surprises To The Good, But Not Where Investors Want To See It

Investors can be fickle, and with that I have to wonder whether Ultratech (NASDAQ:UTEK) will hold on to the positive boost in sentiment that the company gained by reporting better earnings for the first quarter. Guidance for the second quarter was not as strong as could have been hoped, and there has been no easing of concerns regarding the company's ability to play a leading role in rapid thermal processing for sub-20nm chips and grab share from Applied Materials (NASDAQ:AMAT), Mattson (NASDAQ:MTSN), and/or Screen Holdings (OTC:DINRY).

Ultratech shares are still not pricing in any particularly significant ramp in sales or profits. That is in spite of real progress in diversifying the company's portfolio and recent growth in the advanced packaging opportunity. Although I cannot really model a scenario where Ultratech is shut out of the sub-20nm rapid thermal processing market and really thrives, progress with advanced packaging does at least provide some backstop. I continue to believe that Ultratech shares can generate double-digit returns from here, but this is a small position for me and I freely acknowledge that this remains much more of an "if" story than a "when".

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Ultratech Surprises To The Good, But Not Where Investors Want To See It