Advanced Energy (AEIS) AI Stock Analysis

• Market Cap: $5.76B
• Dividend Yield: 0.26%
• Average Volume (3M): 450.71K
• Price to Earnings (P/E): 70.1
• Beta (1Y): 1.85
• Revenue Growth: 8.49%
• EPS Growth: -7.65%
• Country: US
• Employees: 10,000
• Sector: Industrials
• Sector Strength: 75
• Industry: Electrical Equipment & Parts
• EPS (TTM): 1.50
• Shares Outstanding: 37,655,384
• 10 Day Avg. Volume: 548,669
• 30 Day Avg. Volume: 450,715
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.86
• Enterprise Value/Revenue: 3.05
• Enterprise Value/Gross Profit: 8.30
• Enterprise Value/Ebitda: 33.41
• 1Y Price Target: $148.13
• Price Target Upside: -4.09% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 75 Outperform
• Price Target: $172.00 ▲(11.37% Upside)

Advanced Energy's strong earnings call performance and positive technical indicators are the most significant factors driving the stock score. Solid cash flow management and a stable balance sheet further support the score. However, the high P/E ratio and low dividend yield suggest potential overvaluation, which slightly offsets the positive aspects.

Positive Factors

Business Growth

Record design wins including medical, robotics and process control are expected to produce modest growth in Industrial/Medical sales.

Earnings

AEIS reported revenue and EPS that exceeded consensus estimates, driven by sustained strength in the Data Center sector.

Operational Efficiency

The closure of China manufacturing should improve operational efficiencies, providing a tailwind to the company.

Negative Factors

Market Demand

Semi demand is now expected to grow at a slower rate than previously anticipated.

Semiconductor Sales

Semiconductor sales for 2Q25 were down 5.7% sequentially.

Tariffs

Tariffs may pose a headwind to gross margins, although there are strategies to mitigate the impact.

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 solid cash flow management and a stable balance sheet, with improvements in leverage. However, profitability metrics indicate potential areas for operational enhancement. The company is on a recovery path in terms of revenue growth, but further efforts are needed to boost margins and returns.

Income Statement

Advanced Energy shows a moderate revenue growth rate of 4.91% in the TTM, recovering from a decline in previous years. The gross profit margin remains stable around 35.9%, indicating consistent cost management. However, the net profit margin is relatively low at 4.73%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are also modest, reflecting operational efficiency challenges.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.55 in the TTM, indicating a reduction in leverage compared to previous years. Return on equity is moderate at 6.19%, showing a decline from past performance, which may concern investors. The equity ratio is stable, suggesting a balanced capital structure.

Cash Flow

Free cash flow growth is strong at 27.22% in the TTM, highlighting effective cash management. The operating cash flow to net income ratio is 0.48, indicating decent cash generation relative to earnings. The free cash flow to net income ratio of 0.65 suggests a healthy conversion of earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.64B	1.48B	1.66B	1.85B	1.46B	1.42B
Gross Profit	600.57M	529.34M	592.40M	675.51M	532.32M	541.87M
EBITDA	149.11M	138.22M	205.56M	305.52M	210.15M	236.96M
Net Income	83.87M	54.21M	128.28M	199.66M	134.74M	134.68M
Balance Sheet
Total Assets	2.38B	2.26B	2.56B	1.99B	1.82B	1.65B
Cash, Cash Equivalents and Short-Term Investments	713.50M	722.09M	1.04B	458.82M	546.67M	483.02M
Total Debt	687.50M	671.70M	1.02B	390.03M	408.58M	338.64M
Total Liabilities	1.12B	1.06B	1.41B	925.90M	945.84M	833.30M
Stockholders Equity	1.26B	1.20B	1.14B	1.07B	870.85M	814.74M
Cash Flow
Free Cash Flow	125.07M	73.96M	147.93M	124.70M	108.37M	164.75M
Operating Cash Flow	192.45M	130.75M	208.94M	183.59M	140.25M	201.24M
Investing Cash Flow	-69.57M	-73.54M	-64.75M	-208.27M	-47.30M	-42.84M
Financing Cash Flow	-396.74M	-377.09M	445.68M	-61.87M	-25.37M	-29.61M

Advanced Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 154.44
• 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 Positive. The current price of 154.44 is above the 20-day moving average (MA) of 149.07, above the 50-day MA of 141.76, and above the 200-day MA of 119.17, indicating a bullish trend. The MACD of 3.65 indicates Positive momentum. The RSI at 59.07 is Neutral, neither overbought nor oversold. The STOCH value of 53.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AEIS.

Advanced Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENS	80 Outperform	$3.82B	11.57	19.13%	0.94%	3.73%	32.29%
POWL	80 Outperform	$3.30B	17.94	34.00%	0.39%	14.32%	33.76%
ENR	77 Outperform	$1.90B	8.07	164.19%	4.31%	1.15%	2358.45%
AEIS	75 Outperform	$5.76B	70.11	7.04%	0.26%	8.49%	-7.65%
ATKR	65 Neutral	$1.98B	18.89	7.29%	2.21%	-12.09%	-78.18%
Sector *	64 Neutral	$10.95B	16.10	8.81%	1.99%	2.59%	-16.41%
BE	63 Neutral	$11.69B	10,625.53	4.65%	―	22.72%	―

Advanced Energy Corporate Events

Advanced Energy Enters New Credit Agreement with Lenders

On May 8, 2025, Advanced Energy terminated its prior credit agreement from 2019, which provided a $600 million senior unsecured revolving facility, and entered into a new credit agreement with several lenders, including HSBC and Citibank. The new agreement also offers $600 million in financing with the option to increase by $250 million, featuring a five-year term and interest rates based on the Term SOFR or a Base Rate. This move is expected to enhance Advanced Energy’s financial flexibility and support its strategic initiatives, with implications for its leverage management and potential material acquisitions.