Veeco Instruments (VECO) is never going to be the easiest, cleanest, or most popular semiconductor tools story, and that’s okay. Relative to companies like Advanced Energy (AEIS), ASML (ASML), or VAT Group (OTCPK:VACNY), Veeco is more of a “hodgepodge” of tools and end-market opportunities, but while that story may lack some elegance and simplicity, the growth markets are nevertheless real and complemented by underlying execution that has meaningfully improved in recent years.
With momentum in areas like LSA, tools for 5G filters, and data storage, and longer-term opportunities in areas like EUV mask blanks and VCSEL production, I continue to like these shares. The stock has done well since my last update, underperforming the exceptional move at Applied Materials (AMAT), but doing pretty well compared to a lot of other tool companies. With better visibility on revenue growth and margin improvement over the next few years, I see a good argument for a mid-to-high $20s price over the near term.
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Veeco Instruments - Brief Hiccup In Margins Doesn't Change The Positive Long-Term Story
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