Advanced Energy (AEIS) AI Stock Analysis

• Market Cap: $7.64B
• Dividend Yield: 0.2%
• Average Volume (3M): 525.11K
• Price to Earnings (P/E): 53.3
• Beta (1Y): 1.94
• Revenue Growth: 17.18%
• EPS Growth: 235.76%
• Country: US
• Employees: 10,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 1.74
• Shares Outstanding: 37,745,487
• 10 Day Avg. Volume: 731,908
• 30 Day Avg. Volume: 525,105
• PEG Ratio: -1.39
• Price to Book (P/B): 3.60
• Price to Sales (P/S): 2.92
• P/FCF Ratio: 58.59
• Enterprise Value/Market Cap: 0.85
• Enterprise Value/Revenue: 3.75
• Enterprise Value/Gross Profit: 9.98
• Enterprise Value/Ebitda: 28.51
• 1Y Price Target: $214.50
• Price Target Upside: 7.67% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): 6.21
• Revenue Forecast (FY): $1.78B

• Rating: 75 Outperform
• Price Target: $254.00 ▲(27.50% Upside)

Advanced Energy's strong financial performance, driven by robust cash flow and a stable balance sheet, is complemented by positive technical indicators, suggesting bullish momentum. The earnings call provided a positive outlook with significant revenue growth, particularly in data centers. However, the high P/E ratio indicates potential overvaluation, and tariff challenges pose a risk. Overall, the stock presents a solid investment opportunity with some caution advised due to valuation concerns.

Positive Factors

Revenue Growth

Consistent revenue growth over four consecutive quarters indicates strong market demand and effective sales strategies, enhancing long-term business stability.

Data Center Expansion

The significant growth in data center revenue, driven by AI demand, positions the company well in a rapidly expanding sector, ensuring future revenue streams.

Operational Efficiency

Improved operating margins reflect enhanced cost management and operational efficiency, contributing to better profitability and competitive positioning.

Negative Factors

Semiconductor Revenue Decline

Declining semiconductor revenue could indicate challenges in a key market segment, potentially affecting overall growth and market share.

Tariff Challenges

Rising tariffs may increase production costs, impacting profit margins and pricing strategies, thereby affecting long-term financial performance.

Profitability Concerns

Low net profit margins suggest limited profitability, which could hinder reinvestment capabilities and shareholder returns over time.

Advanced Energy Business Overview & Revenue Model

Company Description

Advanced Energy Industries, Inc. designs, manufactures, sells, and supports precision power conversion, measurement, and control solutions worldwide. It offers plasma power solutions, including direct current (DC), pulsed DC, low frequency alternating current, high voltage, and radio frequency (RF) power supplies, as well as RF power supplies, RF matching networks, and RF instrumentation products; and remote plasma sources for reactive gas applications. The company also provides power control modules and thermal instrumentation products for rapid thermal processing, chemical vapor deposition, epitaxy, crystal growing, and chemical processing, as well as metal, carbon fiber, and glass manufacturing and other industrial power applications; high voltage DC-DC products for semiconductor wafer processing and metrology, electrostatic clamping of substrates, scientific instrumentation, mass spectrometry, and X-ray systems for industrial and analytical applications; and low voltage DC-DC board mounted solutions for use in healthcare, telecommunications, test and measurement, instrumentation, and industrial equipment applications, as well as distributed power in server and storage systems. In addition, it offers gas sensing and monitoring products for the energy market, air quality monitoring, and automobile emission monitoring and testing; and embedded power products for medical equipment or IEC 60950-1 for information technology equipment. Further, it offers conversions, upgrades, and refurbishments and used equipment to companies, as well as repair services. The company provides its products through a direct sales force, independent sales representatives, channel partners, and distributors. Advanced Energy Industries, Inc. was incorporated in 1981 and is headquartered in Denver, Colorado.

How the Company Makes Money

Advanced Energy primarily generates revenue through the sale of its power conversion and thermal management products. The company's revenue model is built on providing high-performance, reliable solutions that address the specific needs of its customers in various sectors. Key revenue streams include direct sales of power supplies and related components, as well as service and support for these products. AEIS has established significant partnerships with leading manufacturers in the semiconductor and renewable energy sectors, which not only enhance its product offerings but also contribute to a steady flow of orders. Additionally, the company benefits from a growing demand for energy-efficient technologies, driven by the global trend towards sustainability and the increasing adoption of renewable energy sources.

Advanced Energy Financial Statement Overview

Summary

Advanced Energy demonstrates a solid financial position with strong cash flow generation and a stable balance sheet. The income statement shows recovery in revenue growth and consistent profitability margins. While the company has reduced its leverage significantly, maintaining this trajectory will be crucial for sustaining growth and profitability. The financial health is robust, but attention to revenue volatility and maintaining profitability will be key to future success.

Income Statement

Advanced Energy shows a solid performance in its income statement with a Gross Profit Margin of 37.16% and a Net Profit Margin of 8.41% for TTM (Trailing-Twelve-Months). The company has demonstrated a positive Revenue Growth Rate of 5.45% in the latest TTM period, recovering from previous declines. EBIT and EBITDA margins are stable, indicating efficient operations. However, the historical fluctuations in revenue growth suggest potential volatility.

Balance Sheet

The balance sheet reflects a strong equity position with a Debt-to-Equity Ratio of 0.09 in the latest TTM, significantly improved from previous years. Return on Equity is moderate at 6.91%, indicating decent profitability. The Equity Ratio stands at 53.61%, showcasing a stable financial structure. The reduction in debt levels over time is a positive sign, although the ROE has seen a decline from previous highs.

Cash Flow

Cash flow analysis reveals robust Free Cash Flow Growth of 23.65% in the latest TTM, indicating strong cash generation capabilities. The Operating Cash Flow to Net Income Ratio is 0.65, and the Free Cash Flow to Net Income Ratio is 0.65, both reflecting healthy cash flow management. The company has improved its cash flow metrics over the years, enhancing its financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.72B	1.48B	1.66B	1.85B	1.46B	1.42B
Gross Profit	648.50M	529.34M	592.40M	675.51M	532.32M	541.87M
EBITDA	227.06M	145.94M	205.56M	309.36M	205.18M	236.96M
Net Income	144.97M	54.21M	128.28M	199.66M	134.74M	134.68M
Balance Sheet
Total Assets	2.44B	2.26B	2.56B	1.99B	1.82B	1.65B
Cash, Cash Equivalents and Short-Term Investments	758.80M	722.09M	1.04B	458.82M	544.37M	483.02M
Total Debt	682.80M	671.70M	1.02B	484.49M	503.76M	434.63M
Total Liabilities	1.13B	1.06B	1.41B	925.90M	945.84M	832.32M
Stockholders Equity	1.31B	1.20B	1.14B	1.07B	870.85M	814.74M
Cash Flow
Free Cash Flow	150.94M	73.96M	147.93M	124.70M	108.37M	164.75M
Operating Cash Flow	233.59M	130.75M	208.94M	183.59M	140.25M	201.24M
Investing Cash Flow	-84.94M	-73.54M	-64.75M	-208.27M	-47.30M	-42.84M
Financing Cash Flow	-47.76M	-377.09M	445.68M	-61.87M	-25.37M	-29.61M

Advanced Energy Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 199.22
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AEIS, the sentiment is Neutral. The current price of 199.22 is below the 20-day moving average (MA) of 206.43, above the 50-day MA of 186.10, and above the 200-day MA of 137.90, indicating a neutral trend. The MACD of 6.03 indicates Positive momentum. The RSI at 48.66 is Neutral, neither overbought nor oversold. The STOCH value of 21.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AEIS.

Advanced Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVT	79 Outperform	$17.19B	29.36	8.57%	0.77%	5.31%	5.76%
ENS	78 Outperform	$5.08B	16.08	18.22%	0.77%	6.17%	20.86%
AEIS	75 Outperform	$7.64B	53.27	11.80%	0.20%	17.18%	235.76%
POWL	75 Outperform	$3.98B	22.89	34.00%	0.33%	14.32%	33.76%
VRT	73 Outperform	$65.37B	64.44	38.86%	0.09%	28.76%	76.31%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
ENVX	48 Neutral	$1.73B	―	-68.95%	―	45.98%	44.14%

Advanced Energy Corporate Events

Advanced Energy Industries Reports Strong Earnings Call

The recent earnings call for Advanced Energy Industries, Inc. was marked by a strong positive sentiment, highlighting impressive growth in data center and overall company revenue. Despite facing some hurdles in the semiconductor and industrial medical segments, the company remains optimistic due to strategic investments and successful product launches. The operational shift from China to a new factory in Thailand is a significant milestone, although rising tariffs pose a challenge.

Advanced Energy Industries Reports Strong Q3 2025 Results

Advanced Energy Industries, Inc. is a global leader in the design and manufacture of precision power conversion, measurement, and control solutions for mission-critical applications across various industries, including semiconductor equipment, industrial production, and data center computing.

Advanced Energy Industries Reports Strong Earnings Amid Challenges

The latest earnings call from Advanced Energy Industries, Inc. painted a picture of robust growth tempered by certain challenges. The sentiment was largely positive, driven by strong revenue growth in the data center segment and improved profitability. However, concerns were raised over challenges in the industrial and medical segments, tariff impacts, and a sequential decline in semiconductor revenue. Despite these hurdles, the company’s diversified market strategy and investments in growth areas suggest a promising outlook.

Advanced Energy Industries Reports Strong Q2 2025 Results

Advanced Energy Industries, Inc. is a global leader in the design and manufacture of precision power conversion, measurement, and control solutions for mission-critical applications across various industries, including semiconductor equipment, industrial production, and data center computing. In its latest earnings report for the second quarter of 2025, Advanced Energy reported a revenue of $441.5 million, surpassing the high end of its guidance, with notable growth in its data center computing sector, which nearly doubled year-over-year. The company achieved a GAAP EPS of $0.67 and a non-GAAP EPS of $1.50, reflecting strong customer demand for its AI data center solutions and early signs of recovery in the industrial and medical markets. Key financial highlights include a significant increase in revenue compared to the previous quarter and the same period last year, as well as improvements in both GAAP and non-GAAP net income. The company also generated $46.5 million in cash flow from operations, paid $3.9 million in dividends, and repurchased $22.8 million of common stock. Looking ahead, Advanced Energy remains optimistic about its growth prospects, with expectations to continue expanding revenue and earnings faster than its markets, driven by ongoing demand for its innovative solutions and strategic market positioning.