AEM Holdings stock surges 11% on strong first quarter results

Investing.com -- AEM Holdings Ltd. (SGX:AWX) shares jumped 10.74% Thursday after the semiconductor equipment maker reported first quarter results that exceeded analyst expectations and raised its guidance.

The Singapore-based company posted sales of S$117 million for the first quarter, up 35.8% YoY. Profit before tax reached S$18 million, surging 369% YoY, with a PBT margin of 15.2%, up 172 basis points quarter-over-quarter and 1,084 basis points YoY. Net profit came in at S$14 million, up 329% YoY, with a net margin of 12.3%.

The company attributed its key growth to customer A, while the margin improvement resulted from a shift in mix driven by stronger TCS contribution.

Jefferies analysts commented: "We read the results print as a strong beat given the margins and guidance raise. We note the margin improvement was due to a shift in mix from a stronger TCS contribution. We expect further beat and raise due to industry momentum (test-time elongating and need to produce). We expect positive revision to EPS and growth. We see our bull-case emerging given contribution of ASE and KR memory player revenue which are higher margin. We reiterate BUY on the name."

The first quarter sales represented approximately 23% of both Jefferies' and consensus estimates, while profit before tax formed about 32% and 34% of respective forecasts. Net profit accounted for 33% of both estimates.

You May Also Be Interested In

• Citi reiterates buy rating on Advanced Energy Industries
• Lowe's (LOW) Reiterated at Hold by Stifel as Pricing Slips Sequentially
• BofA Securities Starts IonQ, Inc. (IONQ) at Buy