Recovery in semiconductor equipment demand: Is this period just the "prologue"? Which lagging stocks should be watched? Memory chip resurgence and AI investment accelerating! [Summary of earnings from six manufacturing equipment companies]

<Earnings summary>
① Market environment: Memory investments led by AI logic chips and HBM (High Bandwidth Memory) are on a recovery trend, supported by expanding data center investments for generative AI. Components such as GPUs (graphics processing semiconductors)Investment in the refinement of AI logicIn addition,Re-acceleration of DRAM investments centered around HBM (High Bandwidth Memory)is driving demand. As the industry moves away from the memory market downturn, order environments are improving rapidly. Companies express optimism about growth prospects for the next fiscal year. However, variations by region and application, such as shifts in the proportion of sales to China and timing mismatches in investment projects, still persist.

③ Next fiscal year (FY27 ending March) may be the main phase
Each company is emphasizing 'next-term growth.' This term seems to be the initial stage of recovery, with the next likely becoming the full-scale expansion period.

●Advantest, Discohave a projected PER (Price Earnings Ratio) of around 60x, showing leadership in both earnings and stock price. KOKUSAI is also being bought on expectations of a strong recovery. It appears that stocks with a 'strong connection to AI-driven demand' are receiving a premium.
● On the other hand, integrated equipment makers likeSCREEN Holdingsare trading at the lowest PER among the six companies, despite increasing certainty of a recovery next term.with broad exposure to front-end processesTokyo Electronis also lagging in terms of stock price, and despite expecting record profits this term, the P/E ratio remains at 35x.
● In terms of the gap between the current stock price (closing price on February 13) and analysts' average target price, Advantest and Disco are trading significantly above their average target prices. Some upside potential is suggested, albeit limited, forTokyo Electron, Laserteconly.
●The stock with the highest year-to-date increase is Disco (+52%), followed by Advantest (+38%), SCREEN Holdings (+36%), Tokyo Electron (+22%), KOKUSAI ELECTRIC (+16%), and Lasertec (+4%).

<Individual Stock Earnings Summary>
■ Tokyo Electron: Revised upward, shifting from a profit decline forecast to record profits
●This is the second upward revision for this term.Full-year net profit forecast revised upward to ¥550 billion (+1% YoY), operating profit forecast raised to ¥593 billion. The market forecast was below expectations.
●Share buybacks: Maximum of ¥150 billion (purchased from February 9 to March 31)
●Dividend forecast revised upward: Full-year dividend forecast increased by ¥68 from the previous forecast, reaching a record high of ¥601.

Supported by gains from the sale of policy-held shares, earnings are expected to exceed initial forecasts. On the core business side, the sales ratio for DRAM has increased, and the benefits of memory investment recovery are becoming evident. The company has expressed a bullish outlook, stating that the market for semiconductor front-end equipment they handle is expected to grow by 'over 15%, with over 20% growth now in sight.'

■ Advantest: Right at the Center of AI Special Demand
● Full-year net profit forecast: ¥328.5 billion (double the previous year, third upward revision this fiscal year)
● Operating profit margin forecast: 42%, an increase of 13 percentage points YoY
● Assumed exchange rate revised to ¥146 per dollar, reflecting a ¥3 weakening of the yen compared to October 2025 levels.

The increasing performance and complexity of AI semiconductors are driving demand for the company’s testers. Alongside the expansion of the generative AI market,The sophistication and lengthening of the testing process are expanding revenue opportunitiesand the company is positioned as a core player in the AI investment cycle.

■ SCREEN Holdings: At the stage of confirming a bottoming out
● Full-year earnings forecast and annual dividend forecast remain unchanged. Consolidated sales are expected to decrease 1% year-over-year to 621 billion yen, with net profit down 12% year-over-year to 88 billion yen.
● Delays have occurred in projects for Chinese DRAM, but these are offset by improved profitability and demand recovery.
● A stock split has also been announced, lowering the barrier for individual investors to participate.

Signs of a bottoming out in orders are being confirmed. Delays in projects for China and rising R&D costs remain a drag, but technological superiority in the cleaning equipment field is being maintained.

■ Disco: On track for a sixth consecutive period of record profits in the back-end process
● Current fiscal year net profit forecast: 126.4 billion yen (a 2% increase year-over-year)
● Annual dividend: 437 yen (an increase of 24 yen year-over-year)
●Exchange rate assumption set conservatively at 1 USD = 154 JPY.

A key player in back-end equipment.Six consecutive periods of record profitsOutlook.Growing demand for advanced semiconductors for AIis driving equipment sales, with the consumables business also remaining solid. The operating profit margin exceeds 40%, maintaining one of the highest levels in the industry. The combination of two pillars—AI-related investments and a high-profitability structure—supports the company’s stable growth scenario.

■ KOKUSAI ELECTRIC: Cautious stance continues
●Full-year net profit forecast is 27.9 billion yen:A year-on-year decrease of 22.5% (unchanged)
●Below consensus

While focusing on film deposition equipment for memory applications, the direct connection to AI logic remains relatively low, resulting in a lag in earnings recovery. Although there is a recovery scenario, the timeline is considered longer compared to other companies.

■ Lasertec: Disappointment with order guidance
●Forecast for FY June 2026 net profit: 15% decrease YoY to JPY 72 billion (upwardly revised)
●Order value: JPY 170-220 billion (narrowed range)

Net profit forecastdespite a forecast of profit decline, was upwardly revised.However, the cautious reception of the order guidance indicates it fell short of market expectations. The new product of the flagship photomask inspection system 'ACTIS' is expected to contribute significantly starting in FY 2027. In the short term, expectations may be recalibrated, while long-term focus will remain on technological competitiveness as the evaluation criterion.

★Items for future confirmation
●Impact of temporary factors such as gains from selling policy-held shares
●Accumulation of backlog and cancellation risks
●Changes in reliance on China
●Sustainability of AI Investment
It is necessary to review aspects such as these.

―moomoo News Kei

Source: IR materials from respective companies, moomoo
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