Update shared on 02 Dec 2025
Analysts have held Veeco Instruments' price target steady at $32.75, citing valuation concerns and limited confidence in Axcelis' earnings momentum following the planned merger, despite modest improvements in profitability assumptions.
Analyst Commentary
Recent analyst reports on Veeco Instruments reflect a mix of optimism and caution as the company moves forward with its planned merger with Axcelis. The following summarizes prevailing viewpoints in the market:
Bullish Takeaways- Bullish analysts see the merger with Axcelis as an attractive combination, believing it expands product breadth and increases profitability.
- The transaction is expected to add significant scale to the combined company, which could position it as a more formidable competitor within the industry.
- Some projections suggest that the enlarged entity could become a more compelling acquisition target for larger industry players.
- Profitability assumptions for the merged company have seen modest improvements as a result of anticipated synergies and operational efficiencies.
- Bearish analysts have downgraded Veeco to a more neutral rating, citing ongoing valuation concerns despite recent improvements in outlook.
- There is limited confidence in the sustainability of Axcelis' positive earnings momentum after the merger, particularly due to its high exposure to mature products and certain customer segments.
- More than half of Axcelis' revenue is tied to Chinese customers, which raises concerns about risk concentration and the potential impact of market or regulatory disruptions.
- Some caution that Veeco's estimates are likely to have an upward bias and could lead to future earnings disappointments if projected benefits are not realized.
What's in the News
- Northland analyst Gus Richard downgraded Veeco to Market Perform from Outperform, assigning a $30 price target (Northland).
- Veeco announced receipt of a major order for its Propel 300 system from a leading power semiconductor IDM, reinforcing its leadership in 300mm MOCVD technology (Key Developments).
- Issued earnings guidance for Q4 2025, with revenue expectations ranging from $155 million to $175 million and GAAP diluted earnings (loss) per share between ($0.07) and $0.05 (Key Developments).
- Secured multiple orders for advanced wet processing and lithography systems, supporting AI, automotive, aerospace and defense, and communications sectors; deliveries begin Q1 2026 (Key Developments).
Valuation Changes
- Consensus Analyst Price Target for Veeco Instruments remains unchanged at $32.75.
- Discount rate has decreased slightly from 11.17% to 11.07%.
- Revenue growth projections are steady at 6.17%.
- Net profit margin expectations are unchanged at 8.87%.
- Future P/E ratio has dropped marginally from 41.70x to 41.58x.
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