Up Over 90% in the Past Month, Is Aehr Test Systems a Buy?

NASDAQ: AEHR | Aehr Test Systems News, Ratings, and Charts

AEHR – Aehr Test Systems’ (AEHR) stock has almost doubled in price over the last month and is up 660% in 2021. The company has benefited from an expanding market, allowing it to grow its revenue and earnings at an enviable pace. But has the recent uptick in stock prices pushed its stock’s valuation higher than the company’s fundamentals justify, or does the stock remain a solid bet today? Let’s discuss.

Fremont, Calif.-based Aehr Test Systems (AEHR) provides test systems for burning-in and testing logic and optical and memory integrated circuits. It has installed more than 2,500 systems worldwide that amounted to $16.6 million in sales during its fiscal year 2021.

The increase in the quality and reliability needs of the automotive and mobility integrated circuit markets is driving test requirements, capacity requirements, and several new opportunities for Aehr’s portfolio of products.

Aehr has been on an absolute tear in 2021. The stock has gained an astonishing 661% in price year to date and is up more than over 90% in the last month, easily besting the broader markets. So, should investors be wary of a pullback, or does the stock have sufficient room to surge higher in price the coming months?

Aehr Systems delivered solid quarterly results

The recent uptick in Aehr stock came on the back of results for the company’s 2022 fiscal first quarter that ended in August. Aehr’s bookings in Q1 were at record levels, allowing the company’s management to raise its revenue guidance for its fiscal 2022 also.

In Q1, Aehr Test Systems reported revenue of $5.6 million, which represented a 181% rise year over year. Its bookings stood at $20.7 million, which was higher than the revenue it generated in 2021. Furthermore, its adjusted loss per share stood at $0.02, which was better than Wall Street’s $0,03 forecast.

Company CEO Gayn Erickson explained, “As we discussed and anticipated last year during the beginning of the COVID-19 pandemic, we have emerged a stronger company, with more production customers, more markets and applications, and higher-value products than we had before the start of the pandemic.”

A solid quarter in Q1 meant that Aehr increased its full-year revenue guidance by a stellar 80% in fiscal 2022 to $50 million, indicating year-over-year growth of more than  200%. So, this suggests that investors were buoyed by Aehr’s robust revenue guidance for this fiscal year.

What next for investors?

Aehr Test Systems is off to a strong start in fiscal 2022. Since the end of the last quarter, it has announced an additional $19.4 million in bookings, bringing its total to $40 million. The company attributed its strong bookings to sizeable orders received from a major Fortune 500 customer that is an automotive semiconductor supplier.

Aehr claims that it is in discussions with other silicon carbide suppliers regarding their wafer-level test and burn-in requirements. It expects to add multiple silicon carbide customers in the next six quarters, which will allow Aehr to ramp up production.

The company expects the silicon carbide power semiconductor device market to increase at a 36% annual rate between 2020 – 2026 to $4.5 billion at the end of the forecast period, which will be a key driver of top-line growth.

In addition, the accelerated transition to the widespread adoption of electric vehicles will also drive demand for Aehr products over the long term.

The final takeaway

We can see that Aehr Test Systems is poised to benefit from a rapidly expanding addressable market and multiple secular tailwinds. Its $71 million revenue forecast for its fiscal year 2023 values the stock at a 7x price-to-forward-sales multiple. Analysts also expect its bottom-line to improve from a $0.14 loss per share in 2021 to earnings of $0.69 in 2023, making the stock a top long-term bet right now.


AEHR shares were trading at $20.67 per share on Thursday afternoon, up $0.21 (+1.03%). Year-to-date, AEHR has gained 717.00%, versus a 19.29% rise in the benchmark S&P 500 index during the same period.


About the Author: Aditya Raghunath


Aditya Raghunath is a financial journalist who writes about business, public equities, and personal finance. His work has been published on several digital platforms in the U.S. and Canada, including The Motley Fool, Finscreener, and Market Realist. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
AEHRGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

10 Best POWR Ratings Stocks

Investors love using our POWR Ratings to track down stocks likely to outperform the S&P 500 (SPY). However, on any given day there are over 1,300 that are Buy rated. This leads customers to reach out to us to discover which are the BEST of these stocks. Today I share the answer including details on the current 10 best POWR Ratings stocks. Get the rest below...

:  |  News, Ratings, and Charts

Are Stocks Ready to Break to New Highs?

The stock market (SPY) is on a 5 day winning streak and now less than 1% away from the all time highs. This quickly shakes off weeks of painful pullbacks and volatility. Is the market truly ready to ascend to new heights or is this another fake out before the next leg lower? Find out the rest below...

:  |  News, Ratings, and Charts

TTSH is this Week’s Featured Stock 

The Tile Shop Holdings (TTSH) is a leading specialty retailer of manufactured and natural stone tiles. The company has staged an impressive earnings turnaround. Read more to find out why the stock is a good buy into year-end.

:  |  News, Ratings, and Charts

Buy These 3 Tech Stocks Before They Soar Further

Tech stocks, which were underperformers at the start of the year, have made their way back as investors have been buying on the dip. Many of these stocks, which include Applied Materials Inc. (AMAT), KLA Corporation (KLAC), and Amdocs Limited (DOX) are currently in an uptrend and are expected to continue this momentum.

:  |  News, Ratings, and Charts

TTSH is this Week’s Featured Stock 

The Tile Shop Holdings (TTSH) is a leading specialty retailer of manufactured and natural stone tiles. The company has staged an impressive earnings turnaround. Read more to find out why the stock is a good buy into year-end.

Read More Stories

More Aehr Test Systems (AEHR) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All AEHR News