Advantest achieved record orders and sales in FY Mar-21 and operating profit rose 20.5% to the highest level in 15 years. On top of that management is guiding for another 20% increase in operating profit in FY Mar-22. Are we looking at the peak?
That will not be clear for another two quarters at least. In the meantime, the 1.2 Book-to-Bill ratio recorded in 2H of FY Mar-21, strong demand for both SoC and memory test systems, and much improved mechatronics and service margins suggest that FY Mar-22 guidance may be conservative.
That would be consistent with last fiscal year, when guidance was raised twice but still fell short of the company’s actual performance. We expect demand for test equipment to continue to rise as IC shortages are overcome.
We maintain our ¥12,000 share price target, which indicates upside potential of 16%.
Hoya Corp (7741 JP) reported its 4QFY03/21 and full-year FY03/2021 results on Friday. The company’s revenue for the fourth quarter grew 12% YoY while operating profit grew 33% YoY during the period. The growth in revenue and OP was driven by strong demand for EUV blanks and 3.5-inch HDD substrates for data centers.
Hoya’s revenues for FY03/2021 declined 5% YoY due to the adverse impact from Covid-19, however, operating profit for the year grew 13.2% YoY compared to FY03/2020. Both revenue and OP for FY03/2021 beat consensus estimates as well as the company’s own guidance.
Hoya’s 4QFY03/2020 earnings were affected by the Covid-19 outbreak and a fine related to a settlement with the US Department of Justice. Following the Covid-19 outbreak, Hoya’s earnings declined YoY during the first two quarters of FY03/2021 and earnings started recovering since the December quarter.