Veeco (VECO) AI Stock Analysis

• Market Cap: $1.16B
• Dividend Yield: N/A
• Average Volume (3M): 752.86K
• Price to Earnings (P/E): 18.3
• Beta (1Y): 1.61
• Revenue Growth: 3.30%
• EPS Growth: N/A
• Country: US
• Employees: 1,231
• Sector: Technology
• Sector Strength: 77
• Industry: Semiconductors
• EPS (TTM): 0.37
• Shares Outstanding: 59,935,238
• 10 Day Avg. Volume: 703,876
• 30 Day Avg. Volume: 752,858
• PEG Ratio: -1.78
• Price to Book (P/B): 1.41
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 24.50
• Enterprise Value/Market Cap: 1.11
• Enterprise Value/Revenue: 0.46
• Enterprise Value/Gross Profit: 4.26
• Enterprise Value/Ebitda: 3.55
• 1Y Price Target: $26.83
• Price Target Upside: 39.74% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 73 Outperform
• Price Target: $22.50 ▲( 17.19% Upside)

Veeco shows solid financial performance with strong growth in the semiconductor segment and strategic wins, despite challenges like rising operational costs and tariff impacts. The stock is technically positioned for improvement, and the recent convertible notes exchange is a positive corporate event. While valuation is fair, these factors collectively position Veeco as a stable investment opportunity with growth potential.

Positive Factors

Earnings

Veeco's reported 1Q25 non-GAAP earnings of $0.37 per diluted share were above company guidance and $0.05 above investors’ expectations.

Future Revenue Growth

Revenue from advanced packaging and GAA is expected to fully offset the decline of China revenue.

Order Growth

A pick-up in AP/litho orders from OSATS and mobile customers has been seen, with the firm receiving $35 million in AP/Litho orders from IDM and OSAT customers.

Negative Factors

Backlog Reduction

Veeco ended 2024 with a $410 million backlog, down $80 million year-over-year.

Shipment Delays

Delays by Chinese customers in taking tool shipments resulted in a $15 million hit, leading Veeco to guide lower for the June quarter.

Tariff Impact

Tariffs are expected to negatively impact margins by 100 basis points in 2025.

Veeco Business Overview & Revenue Model

Company Description

Veeco Instruments Inc. (VECO) is a global leader in the design, manufacture, and marketing of thin film process equipment, primarily serving the semiconductor, data storage, and compound semiconductor markets. The company provides advanced technology solutions for the production of microelectronics, enabling precise control of thin film deposition and etching processes. Veeco's core products include deposition systems, etch and clean systems, and other related equipment that cater to the growing demand for high-performance electronic and optoelectronic devices.

How the Company Makes Money

Veeco makes money primarily by selling its advanced thin film process equipment to semiconductor manufacturers, data storage companies, and other high-tech industries. Its revenue model is based on direct sales of equipment, as well as after-sales services including maintenance, spare parts, and software upgrades. Key revenue streams include sales of deposition and etch systems, which are critical in semiconductor fabrication. Veeco also benefits from strategic partnerships and collaborations that enhance its product offerings and market reach, contributing to its earnings. The company's financial performance is influenced by technological advancements and the cyclical nature of the semiconductor industry.

Veeco Financial Statement Overview

Summary

Veeco's financial performance is robust, with a consistent increase in revenue and a positive net profit margin, reflecting improved profitability. The balance sheet shows a moderate debt-to-equity ratio, and the cash flow indicates positive trends. However, increased liabilities and room for improvement in cash flow efficiency are concerns.

Income Statement

Veeco has shown consistent revenue growth, with a significant increase from $419 million in 2019 to $717 million in 2024. The gross profit margin has improved over the years, reaching 42.4% in 2024. Net profit margin has also turned positive, moving from negative figures in previous years to 10.3% in 2024, indicating improved profitability. Despite the fluctuations in EBIT and EBITDA margins, the company has maintained overall growth in its earnings.

Balance Sheet

Veeco's balance sheet reflects a moderate debt-to-equity ratio of 0.40 in 2024, indicating a balanced approach to leverage. The equity ratio stands at 61.6%, showcasing strong equity backing. Return on equity has improved, highlighting efficient use of shareholder funds to generate earnings. However, total liabilities have increased over time, which could pose future risks if not managed carefully.

Cash Flow

The free cash flow has shown a positive trend, growing from a negative $18 million in 2019 to $45 million in 2024. Despite fluctuations in operating cash flow, the company has successfully managed capital expenditures to enhance free cash flow generation. The operating cash flow to net income ratio indicates a stable conversion of income into cash, though there is room for improvement in enhancing cash flow efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
717.30M	666.43M	646.14M	583.28M	454.16M
	Gross Profit
304.00M	285.06M	263.15M	242.27M	194.30M
	EBIT
66.98M	69.94M	60.30M	56.71M	22.57M
	EBITDA
105.02M	8.40M	85.94M	82.77M	54.64M
	Net Income Common Stockholders
73.71M	-30.37M	166.94M	26.04M	-8.39M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
344.31M	305.44M	302.41M	223.93M	319.40M
	Total Assets
1.25B	1.23B	1.13B	898.98M	898.06M
	Total Debt
314.27M	310.50M	308.24M	262.27M	327.42M
	Net Debt
168.68M	151.71M	153.32M	142.53M	197.79M
	Total Liabilities
480.81M	556.60M	550.36M	461.35M	489.69M
	Stockholders Equity
770.77M	672.44M	577.82M	437.63M	408.37M
Cash Flow		Free Cash Flow
45.70M	33.74M	83.88M	27.10M	36.22M
	Operating Cash Flow
63.81M	61.67M	108.48M	67.74M	43.02M
	Investing Cash Flow
-64.55M	-53.33M	-68.88M	44.53M	-71.79M
	Financing Cash Flow
-12.58M	-4.68M	-4.55M	-122.03M	29.10M

Veeco Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 19.20
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VECO, the sentiment is Negative. The current price of 19.2 is below the 20-day moving average (MA) of 19.80, below the 50-day MA of 19.77, and below the 200-day MA of 26.56, indicating a bearish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 44.63 is Neutral, neither overbought nor oversold. The STOCH value of 13.95 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VECO.

Veeco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLAB	80 Outperform	$1.26B	8.42	13.70%	―	-3.85%	5.95%
ACMR	80 Outperform	$1.55B	14.73	12.21%	―	26.21%	17.34%
ACLS	77 Outperform	$1.87B	10.68	18.45%	―	-15.14%	-28.30%
VECO	73 Outperform	$1.16B	18.26	8.68%	―	3.30%	―
Sector *	61 Neutral	$11.29B	10.07	-7.05%	2.96%	7.47%	-10.75%
UCTT	59 Neutral	$915.17M	32.81	3.30%	―	20.20%	―
ICHR	52 Neutral	$570.83M	―	-2.35%	―	13.41%	72.56%

Veeco Corporate Events

Veeco Completes Convertible Notes Exchange for Shares

On May 15, 2025, Veeco Instruments Inc. completed privately-negotiated transactions with holders of its $25 million 3.75% Convertible Senior Notes due 2027, exchanging them for approximately 1.6 million shares of common stock and $5.4 million in cash. This strategic move, following the settlement of 2025 Notes, aims to strengthen Veeco’s balance sheet by reducing debt and interest expenses, thereby enhancing financial flexibility.

The most recent analyst rating on (VECO) stock is a Buy with a $33.00 price target. To see the full list of analyst forecasts on Veeco stock, see the VECO Stock Forecast page.

Veeco’s 2025 Annual Meeting Approves Key Proposals

On May 8, 2025, Veeco held its 2025 Annual Meeting where shareholders voted on various matters, including the election of directors and amendments to the company’s stock purchase plan. All directors up for election were successfully elected, and other proposals, such as the amendment to the 2016 Employee Stock Purchase Plan and the advisory vote on executive compensation, were approved by the required number of votes. Additionally, the appointment of KPMG LLP was ratified.