VAT Group's Valuation Back In Rarified Air

With logic and foundry orders looking healthy and memory at least looking as though its bottomed, a host of semiconductor equipment stocks have done well over the last year or so, including vacuum valve specialist VAT Group (OTCPK:VACNY) (VACN.SW). While this stock gave investors a few of the 10% pullbacks I said I was hoping for in my last article, the shares have been on a good run since August, with a total gain of over 30%.

At this point I can’t say that I see a lot of value in the shares, though I do think sell-side estimates are too low and the stock could be set up for at least a couple of beat-and-raise quarters that expand the multiples even further. I already have expanding share and expanding market opportunities, as well as new record highs for margins in my model, though, and I just can’t see a lot of appeal here other than as a trading/momentum opportunity.

Readers should note that the stock’s ADR is exceptionally illiquid; the Swiss-listed shares offer much better liquidity.

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VAT Group's Valuation Back In Rarified Air