Veeco Looks More Interesting After A Big Pullback

Veeco (VECO) shares have remained quite volatile since my last update; volatility in smaller, under-covered semiconductor equipment names isn’t that unusual, and the coronavirus outbreak adds yet another factor to the mix. On the other hand, Veeco’s fourth quarter results were pretty good and the business seems to be on track to return to profitability later this year. Add in some interesting longer-term opportunities like tools for EUV mask blanks, VCSEL production, and GaN deposition, and I can see reasons for considering these shares.

Not unlike many other equipment providers, these shares have been hammered since Valentine’s Day, with the stock down almost a third from their high. Veeco isn’t my favorite name for many reasons, including the fact that I see it as more of a hodgepodge of tools and market opportunities and I question the long-term margin potential, but there’s a fair price for all going concerns, and I think Veeco is likely trading below that price now.

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Veeco Looks More Interesting After A Big Pullback