Bayerische shares soar by 70 percent, mirroring Aixtron's uptrend
Lively Update:
The Bavarian chip provider situated just outside Munich's city gates is celebrating some jolly news. Since October midway, the company's stock has skyrocketed over 70%.
The lucky winner in this game of stocks is none other than Suess MicroTec. They're a top-notch supplier of equipment and process solutions for the semiconductor market, including photolithography on silicon wafers and chip processing. The boom around electric mobilty and self-driving cars is specifically fueling their flame. Big-time customers like semiconductor manufacturer Infineon and the world's largest chip manufacturer, Taiwan Semiconductor, keep them in business.
Suess MicroTec recently dropped a bomb by predicting a total revenue of roughly 300 million Euros for the fiscal year, beating the average market prediction of 272 million Euros. The secret? An exceptionally rosy fourth quarter, where they delivered equipment valued at more than 100 million Euros.
Meanwhile, Aachen-based company Aixtron, operating in the same biz, expects a revenue of approximately 500 million Euros for 2022. Aixtron takes the cake in profitability with a projected EBIT margin of over 20 percent. Suess MicroTec expects an EBIT margin of around nine percent for the fiscal year, but CEO Bernd Schulte is thinking long and hard to slash the profit gap with Aixtron.
His strategies revolve around cleaning silicon wafers and solutions for the production of silicon carbide chips, which could significantly boost the electric range in vehicles. If CEO Bernd Schulte's plans take root, Suess MicroTec stands a solid chance of booking its ticket to the EBIT margin VIP club.
For the stock enthusiasts: Check out an exceptionally low P/E ratio for this German stock here
As a cherry on top, here are some potential strategies for Suess MicroTec to narrow the performance gap with Aixtron:
- Invest in R&D: By sinking more cash into research, Suess MicroTec could develop state-of-the-art semiconductor manufacturing and microelectromechanical systems (MEMS). Collaborating with pioneering research institutions or forming industry partnerships could be key.
- Scout New Markets: Expansion into lesser-tapped markets or sectors could bring fresh opportunities. Acquiring competitive companies or setting up new manufacturing facilities in growing regions might be ways to achieve this.
- Optimize Efficiency: Streamlining production processes and supply chain management can help trim costs and boost profitability. Adopting lean manufacturing techniques and digital transformation strategies could pay off.
- Diversify Product Lines: Catering to a wider pool of semiconductor applications reduces dependency on specific sectors and beefs up resilience to market fluctuations.
- Strengthen Customer Relationships: Crafting strong, durable partnerships with key customers equals stable orders and project opportunities. Top-notch service, personalized solutions, or flexible pricing structures are potential bonuses.
- Suess MicroTec's impressive stock surge, amounting to over 70% since October, is a testament to their success in the semiconductor industry, particularly in the electric mobility and self-driving car sectors.
- Aixtron, based in Aachen, is another player in the industry, projecting a revenue of approximately 500 million Euros for 2022, with a projected EBIT margin of over 20 percent, surpassing Suess MicroTec's projected margin of around nine percent.
- To bridge the performance gap with Aixtron, Suess MicroTec is considering various strategies, including investing in R&D to develop advanced semiconductor manufacturing and microelectromechanical systems (MEMS), optimizing efficiency through lean manufacturing techniques and digital transformation, and diversifying product lines to cater to a wider pool of semiconductor applications.
- CEO Bernd Schulte is also exploring opportunities in cleaning silicon wafers and the production of silicon carbide chips, which could significantly boost the electric range in vehicles, potentially positioning Suess MicroTec in the exclusive EBIT margin VIP club.
