Key Factors to Note Ahead of Axcelis' (ACLS) Q4 Earnings
Axcelis Technologies Inc ACLS is slated to report fourth-quarter 2023 results on Feb 7.
Recently the company revised its financial outlook for the fourth quarter of 2023 and reiterated its expectations for 2023.
ACLS now anticipates fourth-quarter revenues to surpass $300 million, exceeding the earlier estimate of $295 million. It reiterates its expectation for 2023 revenues to exceed $1.1 billion. Earnings per share for the same quarter are now projected to exceed $2.05, up from the previous estimate of $2.00.
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $295.2 million, which suggests growth of 11% from a year ago. The consensus mark for earnings is pegged at $1.98 per share, indicating an increase of 15.8% from the prior-year levels.
ACLS’ earnings beat the Zacks Consensus Estimate in each of the last four quarters by an average of 18.5%.
Axcelis Technologies, Inc. Price and EPS Surprise
Axcelis Technologies, Inc. price-eps-surprise | Axcelis Technologies, Inc. Quote
Factors to Note
Axcelis attributed its impressive financial performance in the fourth quarter to the adept execution by the 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.
Continued demand for Purion suite of products, especially in the fast-growing silicon carbide power segment is likely to have acted as a tailwind.
The transition to electric vehicles is driving the silicon carbide power device market. This, in turn, is boosting demand for Purion products, especially PurionH200 silicon carbide, Purion XE silicon carbide systems and Purion M silicon carbide tool.
ACLS’ advanced Purion Product Extensions have been aiding it to gain further share in the image sensor and power device manufacturing space. With these product extensions in its portfolio, the company has been boasting implant products for both the silicon IGBT and silicon carbide power device market segments.
However, volatile supply-chain dynamics and global macroeconomic weakness are likely to have acted as headwinds. Soft demand from memory and advanced logic customers, along with increasing expenses toward research and development, and infrastructure, is an added concern.
Recent Developments
In December 2023, the company announced that it shipped Purion XE high energy and Purion H high current implanters to various fabs in Korea and China for manufacturing of DRAM memory devices. The shipments also included a follow-on shipment to an existing customer in Korea.
Also, ACLS had shipped multiple Purion H SiC Power Series and the Purion M SiC Power Series ion implanter systems to prominent power device chipmakers in Europe and Asia.
What Our Model Says
Our proven model does not predict an earnings beat for Axcelis this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
ACLS has an Earnings ESP of +0.88% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few stocks that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter.
Watts Water Technologies WTS has an Earnings ESP of +0.87% and currently carries a Zacks Rank of 2. WTS is set to announce quarterly figures on Feb 12.
The Zacks Consensus Estimate for WTS’ to-be-reported quarter’s earnings and revenues is pegged at $1.78 per share and $532.4 million, respectively. Shares of WTS have gained 20.1% in the past year.
InterDigital, Inc IDCC has an Earnings ESP of +1.93% and presently carries a Zacks Rank #2. IDCC is slated to release quarterly numbers on Feb 15.
The Zacks Consensus Estimate for IDCC’s to-be-reported quarter’s earnings and revenues is pegged at $1.21 per share and $104.3 million, respectively. Shares of IDCC have increased 49.9% in the past year.
Shopify Inc SHOP has an Earnings ESP of +1.02% and currently sports a Zacks Rank #1. SHOP is scheduled to report quarterly earnings on Feb 13. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for SHOP’s to-be-reported quarter’s earnings and revenues is pegged at 31 cents per share and $2.07 billion, respectively. Shares of SHOP have gained 60.8% in the past year.
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