Independent Insight Provider, Japanese equities, LightStream Research

Scott Foster

Securities analyst covering electronics, precision equipment & robotics, engineering, construction, transport and other sectors for more than 25 years in Japan and 3 years in Korea. Permanent resident of Japan.

Independent Insight Provider, Japanese equities

Advantest (6857 JP): Very Strong 1Q, Guidance Raised

Advantest (6857 JP): 3Q Results Point to Further Growth in 2022

Advantest (6857 JP): Sharp Increase in New Orders; Estimates & Price Target Raised

Advantest (6857 JP): 5G Keeps the Ball Rolling

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

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%.

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%.

Advantest (6857 JP): Further Growth Ahead

Advantest Corp

Advantest (6857 JP): Further Growth Ahead