Axcelis (ACLS) Increases Q4 Guidance, Eyes Strong Growth Ahead
Axcelis Technologies ACLS has revised its financial outlook for the fourth quarter of 2023 and reiterated its expectations for 2023. The company is scheduled to report fourth-quarter results on Feb 7, 2024.
The company anticipates fourth-quarter revenues to surpass $300 million, exceeding the earlier estimate of approximately $295 million and reiterates its expectation for 2023 revenues to exceed $1.1 billion. Earnings per diluted share for the same quarter are now projected to exceed $2.05, up from the previous estimate of around $2.00.
The company attributes its impressive financial performance to the adept execution of Axcelis employees and its leading position in the expanding power device market. The company is also optimistic about the sustained health of the power device market in 2024, owing to a robust year-end backlog and strong fourth-quarter bookings.
Axcelis Technologies, Inc. Price and Consensus
Axcelis Technologies, Inc. price-consensus-chart | Axcelis Technologies, Inc. Quote
Apart from this, the company anticipates a recovery in the mature process technology and memory segments, which is likely to lead to substantial growth in 2025. The company is likely to achieve its $1.3 billion revenue target in 2025 owing to rising demand for the Purion product family, robust booking strength, and a backlog extending into 2025.
As part of this strategy, it recently set up a new logistics center in Beverly, MA, to boost logistics and warehouse operations. The state-of-the-art facility is designed to provide flexibility for the company's manufacturing operations, expand its customer base, and drive growth in the long haul.
Axcelis is a leading producer of ion implantation equipment used in the fabrication of semiconductors. The top-line performance is being driven by robust customer demand for Purion’s suite of products, especially in the silicon-carbide power market. The silicon-carbide power device market is being driven by the transition to electric vehicles.
ACLS’ performance is likely to be affected by volatile supply-chain dynamics and global macroeconomic weakness. Increasing expenses toward research and development and infrastructure are likely to be headwinds.
ACLS currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks worth considering in the broader technology space are Blackbaud BLKB, NETGEAR NTGR and Watts Water Technologies WTS. NETGEAR and Blackbaud sport a Zacks Rank #1 (Strong Buy), while Watts Water Technologies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have soared 23.2% in the past year.
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