Value
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 1.2 |
| P/S | 5.1 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 3.8 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 31.0x
- ▸PEG: 0.21
AEIS · Why this verdict
Why Advanced Energy Industries (AEIS) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictBUY WAIT
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Advanced Energy Industries has delivered four consecutive earnings beats against a 26% revenue growth backdrop with strong momentum, though concentrated customer and supplier exposure, a free cash flow conversion rate below 30%, and a price essentially at the near-term technical target argue for patience before adding to the position.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company has beaten consensus estimates in all four of the most recent quarters with an average positive surprise of 11.9%, while delivering 26% year-over-year revenue growth — a combination of consistent execution and genuine top-line expansion. Earnings | Revenue growth stays above 15% year-over-year and EPS beats continue in at least 3 of the next 4 quarters. | →Stable |
| CounterRevenue growth of 26% reflects an industry upturn; if the semiconductor equipment cycle peaks, growth could decelerate sharply and the beat streak could end even without company-specific missteps. | ||
The top three customers and certain sole-sourced supplier components each represent high-priority concentration risks, meaning a single customer loss or a parts supply disruption could disproportionately impact revenue and production without warning. Bear case | No single customer accounts for more than 25% of revenue and no sole-sourced part creates a material production disruption over the next 12 months. | →Stable |
| CounterDeep customer concentration in semiconductor equipment often reflects long qualification cycles and high switching costs that functionally lock in the revenue stream; concentrated can be stickier than it appears. | ||
Price action shows a golden cross formation with the stock above all key moving averages, a rising on-balance volume trend, and strong volume confirmation — the technical setup aligns with the fundamental beat streak. Momentum breakdown | On-balance volume continues to rise and price holds above the 200-day moving average over the next 6 months. | →Stable |
| CounterA gap up of 5% flagged as an extreme move may signal near-term exhaustion; strong momentum setups can reverse quickly if earnings disappoint or sector sentiment shifts. | ||
Free cash flow converts at only 26% of net income, flagged as a quality concern — the majority of reported earnings are not yet translating into cash, limiting the company's financial flexibility relative to what the income statement suggests. Quality breakdown | FCF-to-net-income ratio improves above 60% over 2 consecutive reporting periods, reflecting higher-quality earnings. | →Stable |
| CounterFCF conversion below net income during a high-growth phase often reflects working-capital investment and prepaid supply commitments that normalize as growth moderates; Piotroski scores of 9 out of 9 argue the balance sheet remains sound. | ||
The company has beaten consensus estimates in all four of the most recent quarters with an average positive surprise of 11.9%, while delivering 26% year-over-year revenue growth — a combination of consistent execution and genuine top-line expansion.
→StableEarnings
- Expectation
- Revenue growth stays above 15% year-over-year and EPS beats continue in at least 3 of the next 4 quarters.
CounterRevenue growth of 26% reflects an industry upturn; if the semiconductor equipment cycle peaks, growth could decelerate sharply and the beat streak could end even without company-specific missteps.
The top three customers and certain sole-sourced supplier components each represent high-priority concentration risks, meaning a single customer loss or a parts supply disruption could disproportionately impact revenue and production without warning.
→StableBear case
- Expectation
- No single customer accounts for more than 25% of revenue and no sole-sourced part creates a material production disruption over the next 12 months.
CounterDeep customer concentration in semiconductor equipment often reflects long qualification cycles and high switching costs that functionally lock in the revenue stream; concentrated can be stickier than it appears.
Price action shows a golden cross formation with the stock above all key moving averages, a rising on-balance volume trend, and strong volume confirmation — the technical setup aligns with the fundamental beat streak.
→StableMomentum breakdown
- Expectation
- On-balance volume continues to rise and price holds above the 200-day moving average over the next 6 months.
CounterA gap up of 5% flagged as an extreme move may signal near-term exhaustion; strong momentum setups can reverse quickly if earnings disappoint or sector sentiment shifts.
Free cash flow converts at only 26% of net income, flagged as a quality concern — the majority of reported earnings are not yet translating into cash, limiting the company's financial flexibility relative to what the income statement suggests.
→StableQuality breakdown
- Expectation
- FCF-to-net-income ratio improves above 60% over 2 consecutive reporting periods, reflecting higher-quality earnings.
CounterFCF conversion below net income during a high-growth phase often reflects working-capital investment and prepaid supply commitments that normalize as growth moderates; Piotroski scores of 9 out of 9 argue the balance sheet remains sound.
Per-dimension breakdown
Quality
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.9 |
| ROA | 4.0 |
| Gross margin | 3.8 |
| Op margin | 5.7 |
| Net margin | 5.0 |
| Current ratio | 5.8 |
| FCF quality | 2.1 |
| Moat | 6.9 |
| Piotroski F | 10.0 |
- ▸Earnings quality RED FLAG: 26% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
9.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 9.1 |
| EPS growth | 10.0 |
- ▸Strong growth: 26% YoY
Momentum
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 3.1 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.8 |
| Analyst rating | 7.0 |
| Price target | 6.5 |
- ▸Light analyst coverage (10.0) — signal dampened
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider selling — $448,165 (0.003% of mkt cap)
Peer rank
3.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.4 |
| quality rank | 5.5 |
| growth rank | 5.0 |
Technical
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.7 |
| support resistance | 3.0 |
| 52w position | 8.1 |
Risk (lower is worse)
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.1 |
| days to cover | 8.7 |
| volatility | 0.0 |
| put call | 10.0 |
| implied vol | 1.0 |
| beta | 5.8 |
| debt equity | 8.0 |
| news risk | 6.0 |
- ▸High IV: 74%
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 8.5 |
| dividend safety | 5.2 |
| news activity | 5.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 11.0%
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more. | News modifier +2 (HOLD_IF_HOLDING → STRONG_BUY_WAIT).
Engine technical detail
verdict_path:
L4:PATH_F_HOLD|L3:NEWS_MOD=+2|ENTRY_STICKY:WITHIN_BANDPassed (6)
- MOMENTUM:5.7>=5.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:41d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.3=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.27
Upside
-4.1%
Downside
15.0%
Sizing output
STARTER
SetupBREAKOUT — Golden cross, above all MAs, RSI 59, MACD bullish
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:5.7>=5.5. Top dim: Growth at 9.6; weakest: Peer rank at 3.2. No conviction either direction.
The strongest dimensions are Growth at 9.6, Catalyst at 6.5, and Sentiment at 6.4; the weakest are Peer rank at 3.2, Value at 4.4, and Technical at 4.6. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -0.27 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The company has beaten consensus estimates in all four of the most recent quarters with an average positive surprise of 11.9%, while delivering 26% year-over-year revenue growth — a combination of consistent execution and genuine top-line expansion.
Trip ifRevenue growth falls below 15% year-over-year for 2 consecutive quarters.
- P2The top three customers and certain sole-sourced supplier components each represent high-priority concentration risks, meaning a single customer loss or a parts supply disruption could disproportionately impact revenue and production without warning.
Trip ifA single customer exceeds 25% of total revenue in any reported period.
- P3Price action shows a golden cross formation with the stock above all key moving averages, a rising on-balance volume trend, and strong volume confirmation — the technical setup aligns with the fundamental beat streak.
Trip ifPrice closes below the 200-day moving average for more than 10 consecutive trading sessions.
- P4Free cash flow converts at only 26% of net income, flagged as a quality concern — the majority of reported earnings are not yet translating into cash, limiting the company's financial flexibility relative to what the income statement suggests.
Trip ifFCF-to-net-income ratio rises above 60% for 2 consecutive reporting periods.