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Advantest Corp (ATEYY)
OTHER OTC:ATEYY
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Advantest
(OTC:ATEYY)
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Rating:59Neutral
Price Target:
$129.00
▲(1.10% Upside)
Advantest's overall stock score is driven by strong financial performance, despite revenue and cash flow challenges. Technical analysis indicates a neutral to bearish trend, and valuation metrics suggest the stock may be overvalued. The absence of earnings call data and corporate events limits additional insights.
Positive Factors
Strong Profitability
High gross and net profit margins indicate efficient operations and strong pricing power, which can sustain profitability even in challenging market conditions.
Financial Stability
Low leverage provides financial flexibility and reduces risk, allowing the company to invest in growth opportunities without significant financial strain.
High Return on Equity
A high ROE indicates effective use of equity capital, which can attract investors and support future growth through reinvestment of profits.
Negative Factors
Revenue Decline
A substantial drop in revenue could signal weakening demand or increased competition, potentially impacting long-term growth prospects if not addressed.
Negative Free Cash Flow Growth
Declining free cash flow growth may limit the company's ability to fund new projects or return capital to shareholders, affecting future expansion and shareholder value.
Market Challenges
These challenges suggest potential market headwinds or operational inefficiencies that could hinder the company's ability to maintain its competitive position.
Advantest (ATEYY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$94.61B
Dividend Yield0.18%
Average Volume (3M)74.83K
Price to Earnings (P/E)53.5
Beta (1Y)2.09
Revenue Growth64.87%
EPS Growth153.13%
CountryUS
Employees6,766
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)0.72
Shares Outstanding766,141,240
10 Day Avg. Volume49,195
30 Day Avg. Volume74,829
Financial Highlights & Ratios
PEG Ratio0.19
Price to Book (P/B)9.63
Price to Sales (P/S)6.26
P/FCF Ratio18.30
Enterprise Value/Market Cap115.59
Enterprise Value/Revenue15.27
Enterprise Value/Gross Profit25.38
Enterprise Value/Ebitda39.49
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Advantest Business Overview & Revenue Model
Company DescriptionAdvantest Corporation manufactures and sells semiconductor and component test system products and mechatronics-related products. It operates through three segments: Semiconductor and Component Test System; Mechatronics System; and Services, Support and Others. The Semiconductor and Component Test System segment provides customers with test system products for the semiconductor industry and the electronic parts industry. This segment offers test systems for SoC semiconductor devices; and test systems for memory semiconductors devices. The Mechatronics System segment provides test handlers; mechatronic-applied products for handling semiconductor devices; and device interfaces, which serve as interfaces with the devices that are measured. This segment also engages in the operations related to nano-technology products. The Services, Support and Others segment provides customer solutions for the semiconductor and component test system and mechatronics system segments; and support services. This segment is also involved in the sale of consumables and used products; and equipment lease business and others. In addition, the company engages in the research and development activities measuring and testing technologies. Advantest Corporation serves fabless semiconductor companies, foundries, and test houses, as well as industrial, design, and manufacturing companies in Japan, rest of Asia, the United States, and Europe. Advantest Corporation has collaboration with STMicroelectronics on advanced automated test cell for IC Testing; and partnership with PDF Solutions Inc. for cloud-based software solutions. The company was founded in 1954 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyAdvantest generates revenue primarily through the sale of its semiconductor test equipment, systems, and software solutions. The company has a diversified revenue model that includes direct sales to semiconductor manufacturers, as well as ongoing support and maintenance services for its equipment. Key revenue streams include the sale of new test systems, upgrades and retrofits to existing systems, and software licensing. Advantest also benefits from strategic partnerships with major semiconductor companies, which can lead to long-term contracts and stable revenue flows. Additionally, the company's focus on innovation and development of cutting-edge testing technologies positions it to capture market share in emerging sectors, contributing to its overall earnings growth.
Advantest Earnings Call Summary
Earnings Call Date:Apr 25, 2025
(Q4-2024)
| % Change Since: |
Next Earnings Date:Feb 04, 2026
Earnings Call Sentiment Positive
Advantest Corporation reported a strong financial performance in FY 2024 with record-high sales and profits, and a positive outlook for continued demand in AI-related semiconductor testing for FY 2025. However, challenges such as impairment losses, increased tax rates, and market competition present some risks.Q4-2024 Updates
Positive Updates
Record-High Financial Performance in FY 2024
Advantest Corporation achieved record highs in sales, operating income, and net income for FY 2024, driven by strong demand for AI-related high-performance semiconductors and effective supply chain management.
Exceeded Sales Guidance
FY 2024 sales exceeded initial guidance by approximately JPY40 billion, primarily due to greater-than-expected deliveries, particularly in SoC testers.
Strong Market Position and Product Launches
Advantest maintained a majority share in the semiconductor tester market and launched several new test solutions, including a new power supply for HPC applications and memory test systems.
Positive Outlook for FY 2025
The company expects continued high demand for AI-related SoC semiconductors, with sales and profits projected to grow slightly year-over-year on a constant currency basis.
Shareholder Returns and Strategic Initiatives
Announced a share repurchase program of up to JPY70 billion as part of a strategy to enhance shareholder returns and capital efficiency.
Negative Updates
Impairment Loss and Increased Tax Rate
The company recorded an impairment loss of approximately JPY24.1 billion related to Essai's socket business, resulting in a higher effective tax rate of approximately 28%.
Limited Visibility in Second Half of FY 2025
Advantest expressed uncertainty about the second half of FY 2025, citing potential macroeconomic and geopolitical risks that could affect demand.
Slight Decline in SoC Market Share
Estimated market share in the SoC tester market decreased by about 3 percentage points due to increased competition from local suppliers in China.
Company Guidance
In the financial briefing call for Advantest Corporation's fiscal 2024, the company reported record-high sales, operating income, and net income, driven by strong demand for AI-related high-performance semiconductors. The fiscal year 2024 sales exceeded the guidance by approximately JPY40 billion, primarily due to higher-than-expected deliveries, particularly of SoC testers. The core operating income margin reached 32%, significantly surpassing guidance. Despite an impairment loss affecting operating margin and net profit, the effective tax rate rose to approximately 28%. Advantest expects continued strong demand for tester products in FY 2025, with sales forecasted at JPY755 billion and operating income at JPY242 billion. The company maintains a robust position in the high-end SoC market, with an overall market share of approximately 58%, although facing increased competition from local suppliers in China. The fiscal 2025 outlook includes a dividend forecast and share repurchase program, aiming for a cumulative total return ratio of 50% or more over the three years of the third midterm management plan.Advantest Financial Statement Overview
Summary
Advantest shows strong profitability with high margins and effective cost management. However, challenges include a significant revenue decline and negative free cash flow growth. The low leverage and high return on equity indicate financial stability.Income Statement
Advantest's income statement shows strong profitability with a high gross profit margin of 60.72% and a net profit margin of 26.78% in the TTM. However, the company experienced a significant revenue decline of 20.86% in the TTM, indicating potential challenges in maintaining growth. Despite this, EBIT and EBITDA margins remain robust, suggesting effective cost management.75
Positive
Balance Sheet
The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.15 in the TTM, indicating prudent leverage management. The return on equity is impressive at 47.84%, showcasing strong profitability relative to shareholder equity. However, the equity ratio is not provided, which limits a full assessment of asset financing.70
Positive
Cash Flow
Cash flow analysis reveals a decline in free cash flow growth by 21.43% in the TTM, which could impact future investments. The operating cash flow to net income ratio is slightly above 1, indicating adequate cash generation relative to net income. The free cash flow to net income ratio is healthy at 91.42%, suggesting efficient cash conversion.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 716.06B | 779.71B | 486.51B | 560.19B | 416.90B | 312.79B |
| Gross Profit | 430.85B | 445.08B | 246.03B | 319.06B | 235.91B | 168.29B |
| EBITDA | 276.96B | 257.13B | 108.98B | 189.08B | 129.70B | 83.25B |
| Net Income | 182.62B | 161.18B | 62.29B | 130.40B | 87.30B | 69.79B |
Balance Sheet | ||||||
| Total Assets | 6.58B | 854.21B | 671.23B | 600.22B | 494.70B | 422.64B |
| Cash, Cash Equivalents and Short-Term Investments | 2.02B | 262.54B | 106.70B | 85.54B | 116.58B | 149.16B |
| Total Debt | 91.14B | 93.50B | 94.44B | 50.84B | 43.46B | 11.85B |
| Total Liabilities | 361.20B | 347.67B | 240.05B | 231.53B | 200.07B | 142.27B |
| Stockholders Equity | 4.13B | 506.54B | 431.18B | 368.69B | 294.62B | 280.37B |
Cash Flow | ||||||
| Free Cash Flow | 224.59B | 266.54B | 12.13B | 46.64B | 60.67B | 54.55B |
| Operating Cash Flow | 240.59B | 285.97B | 32.67B | 70.22B | 78.89B | 67.83B |
| Investing Cash Flow | -30.46B | -42.19B | -27.94B | -26.71B | -46.91B | -16.83B |
| Financing Cash Flow | -67.32B | -82.82B | 10.76B | -77.43B | -68.74B | -30.41B |
Advantest Technical Analysis
Positive
127.60
Price Trends
127.64
Positive
109.15
Positive
82.73
Positive
Market Momentum
0.15
Positive
52.35
Neutral
64.69
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ATEYY, the sentiment is Positive. The current price of 127.6 is below the 20-day moving average (MA) of 128.81, below the 50-day MA of 127.64, and above the 200-day MA of 82.73, indicating a bullish trend. The MACD of 0.15 indicates Positive momentum. The RSI at 52.35 is Neutral, neither overbought nor oversold. The STOCH value of 64.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ATEYY.
Advantest Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $22.10B | 71.68 | 3.87% | ― | -16.13% | -81.06% | |
71 Outperform | $31.15B | 72.39 | 15.77% | 0.24% | 4.56% | -15.44% | |
69 Neutral | $33.42B | 30.25 | 11.17% | 2.29% | 8.01% | 10.41% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $94.61B | 53.50 | 47.37% | 0.18% | 64.87% | 153.13% | |
57 Neutral | $23.21B | 46.13 | 3.00% | 1.28% | -17.33% | -76.71% | |
54 Neutral | $35.10B | -143.80 | -2.85% | 2.79% | -23.36% | -131.15% |
* Technology Sector Average
ATEYY
Advantest
128.95
71.35
123.87%
ASX
ASE Technology Holding Co
15.72
5.83
58.95%
MCHP
Microchip
64.94
9.57
17.28%
ON
ON Semiconductor
54.93
-8.53
-13.44%
STM
STMicroelectronics
26.24
1.55
6.28%
TER
Teradyne
198.90
72.75
57.67%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.