Loop Capital Starts Advanced Energy Industries (AEIS) at Hold

Loop Capital analyst Scott Graham initiates coverage on Advanced Energy Industries (NASDAQ: AEIS) with a Hold rating and a price target of $78.00.

The analyst comments "We are initiating coverage of AEIS with a HOLD rating and $78 price target. The company is a leading supplier of power conversion, supply, control and measurement products for the Semiconductor, Industrial, Datacenter, Medical and Telecom markets. Demand has been strong across its segments from favorable verticals and secular trends. AEIS’ growth strategies are generating design wins and its investments should continue this momentum. But earnings have been hurt by parts and components shortages, and materials and freight inflation, and more so than our other stocks. Earnings reset significantly lowerlast year. AEIS has navigated these pressures better in the last two quarters but we’re not expecting them to abate this year. So while we see untapped earnings power, we prefer more de-risking of earnings in the next couple quarters before getting positive on AEIS. We are concerned a consumer recession next year impacts the Semiconductor markets. AEIS’ large backlog and diversified portfolio would provide insulation to earnings, in our view, IF the company escapes the clutches of the supply chain and inflation pressures. Our estimates are slightly below the Street. We view AEIS as fairly valued."

For an analyst ratings summary and ratings history on Advanced Energy Industries click here. For more ratings news on Advanced Energy Industries click here.

Shares of Advanced Energy Industries closed at $72.27 yesterday.

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