'Leader in niche markets' - Berenberg starts SUESS MicroTec coverage with 'buy'
29/05/2024 12:37
** Berenberg initiates SUESS MicroTec SMHNn.DE with
"buy", seeing a growing need for the German semiconductor
equipment supplier's bonding solutions from AI development
** The broker notes SUESS is a leader in niche markets,
expecting its temporary bonder solutions to be the major growth
driver in the near term
** Temporary bonding and debonding "will become increasingly
important for AI chip production", the broker adds
** Although during the last five years SUESS had lower
margins than peers, it is has started cutting costs,
streamlining its product portfolio and using outsourcing
opportunities, which should help EBIT margin, the broker says
** Berenberg expects the company's profitability to improve
to 16% in 2026 from 9% in 2023; adding order backlog of EUR 453
million ($491 million) in Dec 2023 provides good visibility for
2024 growth
** Bonders and photomasks divisions stood out in the order
book, supported by rising demand, the broker says
** Out of 7 analysts that cover SUESS MicroTec, four rate
the stock "strong buy"/"buy," three rate it "hold," and no
analysts rate the stock "strong sell"/"sell" - LSEG data
($1 = 0.9225 euros)
(Reporting by Amir Orusov)
((Amir.orusov@thomsonreuters.com))