Cohu (COHU) AI Stock Analysis

• Market Cap: $1.25B
• Dividend Yield: N/A
• Average Volume (3M): 829.01K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.70
• Revenue Growth: -4.50%
• EPS Growth: -45.79%
• Country: US
• Employees: 2,986
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): -0.06
• Shares Outstanding: 46,692,616
• 10 Day Avg. Volume: 567,782
• 30 Day Avg. Volume: 829,015
• PEG Ratio: 0.05
• Price to Book (P/B): 1.47
• Price to Sales (P/S): 3.13
• P/FCF Ratio: -160.20
• Enterprise Value/Market Cap: 0.65
• Enterprise Value/Revenue: 1.92
• Enterprise Value/Gross Profit: 4.51
• Enterprise Value/Ebitda: -47.62
• 1Y Price Target: $30.00
• Price Target Upside: 8.62% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 53 Neutral
• Price Target: $27.00 ▼(-2.24% Downside)

The score is held back primarily by weak financial performance (losses and deteriorated free cash flow), partially offset by improving technical trend signals and a moderately constructive earnings-call outlook driven by recurring revenue and margin expectations. Valuation remains a concern due to negative earnings and no stated dividend yield.

Positive Factors

Recurring revenue expansion

Sustained growth in recurring revenue (services, spares, interface solutions) increases revenue predictability and supports higher gross margins. With management forecasting recurring revenue to comprise a majority of sales, this durable stream cushions cyclicality in systems sales and supports long-term margin stability.

Low financial leverage

Very low leverage gives the company financial flexibility to invest in R&D, support working capital during cyclical downturns, and pursue strategic opportunities without pressuring interest coverage. This capital structure reduces refinancing risk while operations are being improved.

Strategic product wins in AI test

Winning selection for production testing of next‑gen AI processors demonstrates competitive product differentiation and positions Cohu to capture secular AI-driven test volumes. Production test programs can translate into multi‑year system, service and spare-part revenue streams.

Negative Factors

Negative profitability

Sustained negative margins and ROE indicate the company is not converting sales into profit or shareholder returns. This undermines internal funding for growth, increases reliance on external financing, and signals the need for structural cost or mix improvements to restore durable profitability.

Severely deteriorated free cash flow

A dramatic FCF decline erodes reserves and operational flexibility, forcing management to seek external capital (e.g., recent convertible notes). Persistently weak cash generation limits investing in product development, constrains working-capital support for customers, and raises financing risk.

Volatility in systems orders

Dependence on lumpy systems sales creates revenue and margin volatility despite growing recurring revenue. Moderation and seasonal slowdowns in systems orders can compress near‑term cash and margins, making earnings less predictable and complicating long-term planning for capacity and R&D.

Cohu Business Overview & Revenue Model

Company Description

Cohu, Inc., through its subsidiaries, provides semiconductor test equipment and services in China, the United States, Taiwan, Malaysia, the Philippines, and internationally. The company supplies semiconductor test and inspection handlers, micro-electromechanical system (MEMS) test modules, test contactors, thermal sub-systems, and semiconductor automated test equipment for semiconductor and electronics manufacturers, and test subcontractors. It also provides semiconductor automated test equipment for wafer level and device package testing; various test handlers, including pick-and-place, turret, gravity, strip, and MEMS and thermal sub-systems; interface products comprising test contactors, and probe heads and pins; spares and kits; various parts and labor warranties on test and handling systems, and instruments; and training on the maintenance and operation of its systems, as well as application, data management software, and consulting services on its products. In addition, the company offers data analytics product that includes DI-Core, a software suite used to optimize Cohu equipment performance, which provides real-time online performance monitoring and process control. It markets its products through direct sales force and independent sales representatives. The company was formerly known as Cohu Electronics, Inc. and changed its name to Cohu, Inc. in 1972. Cohu, Inc. was incorporated in 1947 and is headquartered in Poway, California.

How the Company Makes Money

Cohu generates revenue primarily through the sale of its test and inspection equipment, as well as through service and support contracts for its installed base of products. The Semiconductor Test segment is a significant revenue driver, where the company sells advanced test handlers and systems to semiconductor manufacturers. Additionally, Cohu earns recurring revenue from maintenance and support services. Partnerships with leading semiconductor companies and a strong presence in the growing markets of automotive and consumer electronics contribute to its earnings. As the demand for higher quality and more efficient testing solutions increases, Cohu benefits from strategic collaborations and technological advancements that drive its revenue growth.

Cohu Financial Statement Overview

Summary

Cohu faces a challenging financial environment with declining profitability and cash flow issues. The income statement shows a negative net profit margin and declining EBIT and EBITDA margins. The balance sheet is stable with low leverage, but the cash flow statement indicates significant challenges with a negative free cash flow growth rate.

Income Statement

Cohu's income statement shows a challenging period with declining profitability. The TTM data reveals a negative net profit margin of -17.22%, indicating losses. Revenue growth is positive at 7.85%, but gross profit margins have significantly decreased to 8.54% from previous years. The company needs to address its declining EBIT and EBITDA margins to improve financial health.

Balance Sheet

The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.058, suggesting manageable leverage. However, the return on equity is negative at -8.65%, highlighting inefficiencies in generating returns for shareholders. The equity ratio remains strong, indicating a solid capital structure.

Cash Flow

Cohu's cash flow statement indicates significant challenges, with a negative free cash flow growth rate of -1274.27% in the TTM period. The operating cash flow to net income ratio is negative, reflecting cash flow issues. Despite a high free cash flow to net income ratio of 3.09, the overall cash flow performance is weak and needs improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	424.85M	401.78M	636.32M	812.77M	887.21M	636.01M
Gross Profit	180.97M	179.83M	302.81M	382.87M	386.40M	275.51M
EBITDA	-17.15M	-19.41M	96.97M	171.72M	180.64M	74.11M
Net Income	-73.14M	-69.82M	28.16M	96.85M	167.32M	-13.84M
Balance Sheet
Total Assets	1.02B	999.41M	1.15B	1.23B	1.26B	1.09B
Cash, Cash Equivalents and Short-Term Investments	198.16M	262.09M	335.70M	385.58M	379.90M	170.03M
Total Debt	49.90M	18.69M	58.94M	103.16M	144.88M	345.73M
Total Liabilities	190.18M	142.52M	200.18M	298.57M	376.54M	578.06M
Stockholders Equity	831.09M	856.89M	950.17M	928.84M	882.50M	512.29M
Cash Flow
Free Cash Flow	-30.48M	-7.86M	85.42M	98.09M	85.73M	31.07M
Operating Cash Flow	-9.86M	2.78M	101.47M	112.86M	97.73M	49.73M
Investing Cash Flow	-29.20M	21.92M	-30.21M	-67.87M	39.89M	-18.36M
Financing Cash Flow	-669.00K	-59.03M	-68.14M	-91.07M	6.53M	-38.07M

Cohu Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 27.62
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COHU, the sentiment is Positive. The current price of 27.62 is above the 20-day moving average (MA) of 24.47, above the 50-day MA of 23.95, and above the 200-day MA of 20.17, indicating a bullish trend. The MACD of 0.85 indicates Negative momentum. The RSI at 70.38 is Negative, neither overbought nor oversold. The STOCH value of 86.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COHU.

Cohu Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLAB	74 Outperform	$1.97B	14.72	11.89%	―	-2.04%	8.84%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
IMOS	60 Neutral	$1.30B	172.89	0.98%	2.25%	0.96%	-85.27%
COHU	53 Neutral	$1.25B	-17.63	-8.53%	―	-4.50%	-45.79%
AEHR	52 Neutral	$789.77M	-89.17	-6.97%	―	-3.23%	-122.16%
UCTT	51 Neutral	$1.55B	-9.88	-20.61%	―	6.65%	-4652.36%
AOSL	48 Neutral	$663.76M	-6.86	-11.17%	―	5.81%	-376.55%