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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Veeco Instruments Inc. (XNAS:VECO) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
VECO
Name:
VEECO INSTRUMENTS INC. (XNAS:VECO)
Sector:
13.87M
Industry:
Semiconductor Equipment & Materials
CEO:
Dr. William Miller
Total Employees:
1,091
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -151.73% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF VEECO INSTRUMENTS INC.(VECO) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SEMICONDUCTOR EQUIPMENT & MATERIALS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
19.73
One Month Price Target:
$19.87
Six Month Price Target :
$20.59
Likely Price in One Year's Time:
Ticker:
$21.45
Likely Trading Range Today Under (Normal Volatility)
$19.63
Price Upper limit ($) :
$19.88
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$18.27
This week:
$16.46
This month :
$13.2
Other Primary facts
Market Cap:
1.00B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
51.43M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
19.22%
-22.99%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$26.51
$23.37
$12.95
$16.09
Medium risk (<10%) entry points
Buy Call
Sell Call
$22.35
Buy Put:
Sell Put:
$21.68
$17.10
$17.78
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
VECO
Sharpe Ratio:
2.99%
Comparison:
VECO, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 7.61% higher than the industry
& ratio is 30.98% higher than the market/S&P 500 average
Average Returns/Yield of
VECO
Daily returns:
0.12%
Weekly returns:
0.59%
Monthly returns:
2.36%
Yearly returns:
28.31%
Comparison of returns:
Average annual returns/yield (last 3 years) is 0.23% above industry average
Classification:
VECO, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.62
Statistical test of Returns:
VECO has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.66%
Weekly Volatility:
8.19%
Monthly Volatility:
16.38%
Yearly Volatility:
56.76%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.19%
Volatility in last five trading days has been -67.47% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-7.41%
Weekly VaR:
-16.56%
Monthly VaR:
-33.12%
How Much Can the price of
VECO
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-28%
Worst case (decline):
>85%
This translates to price declining to:
$14.22
This translates to price declining to:
$2.96
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
VECO is a 133.77% riskier investment compared to the market/S&P 500 & is 100.27% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -2.18% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
VECO
Beta in relation to market/S&P 500--1.30
Expected beta in 1 year's time:
0.783
Expected beta in 3 year's time:
1.107
Unlevered (debt free) Beta:
0.758
Beta in relation to Nasdaq (XNAS):
1.019
Beta in relation to all global stocks::
1.215
Beta Comparison & Analysis
Beta of competitors/peers::
1.476
Beta is -11.95% lower than peers
Average Industry Beta:
1.394
Beta is -6.78% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
4.22%
Sustainable growth rate is -83.59% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.163
Alpha is 4.56% above industry average alpha yield
Alpha is 1039% higher than market/& is unsustainably high
Analysis of Cost of Capital of
VECO
Equity cost of capital:
0.121
Equity cost of capital is -5.09% below industry mean WACC
Unlevered (without debt) cost of capital:
7.03%
Before-tax cost of debt:
7.88%
After-tax cost of debt:
6.23%
Overall debt rating:
Non-investment grade (junk/speculative grade
Weighted average cost of capital (WACC):
6.23%
WACC is -5.20% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$11.78
Revenue growth rate per share of (3Y):
2.51
Annual revenue growth rate is -91.39% below industry average
EPS:
$0.64
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$0.70
-
-
Debt per share
$5.57
EBITDA per share
$1.68
Valuation Analysis Today of
VECO
P/E Ratio:
28.75
P/E Ratio of Competitors/Peers:
111.38
P/E ratio is -74.19% lower than main peers & is 0.19% higher than the industry
Stock price/value with industry average P/E ratio: $18.37
VECO is 7.42% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
1.67
Price to sales ratio is -73.84% below the industry mean
P/B (Price to book value ratio):
2.51
Price to free cash flow: 28.12
Price to free cash flow ratio is 8.03% higher than the industry
Net income growth rate (3Y):
-106.24%
Net income growth rate is -115.53% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
70.93%
Net debt to equity ratio:
45.37%
Debt to assets ratio:
31.10%
Net debt to assets ratio:
19.89%
Debt-to-asset ratio is -37.57% below industry average
Ability to repay debt:
Interest coverage ratio:
3.53
Interest coverage ratio is -81.83% less than industry average
Looking forward:
Debt growth rate:
-19.56%
Annual debt growth is -2552% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.525
Statistical significance of correlation:
VECO has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.604
Stock price is -12.98% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.604
Correlation of price movement with Nasdaq (^IXIC):
-0.003
Covariance of price movement with the market:
-0.007
Kurtosis
6.35
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.327
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
VECO
Gross Profit Margin Ratio:
167%
Operating Profit Margin Ratio:
10.53%
Operating profit margin is -334.58% lower than the industry
Net Profit Margin Ratio:
167%
Effective Tax Rate:
-0.75%
Effective tax rate is -105.73% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9.14%
Return on equity (ROE) is -35.73% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
4.01%
Return on assets (ROA) is -53.56% lower than the industry
Financial Leverage:
1.5x
Current Ratio:
2.58
Current ratio is -41.15% below industry average
Cash Conversion Cycle (days):
66.1
Cash conversion cycle is 13.49% above industry average
The remaining useful life of property plant & equipment is: 10.6 years
Stock based compensation to net income ratio:
12.15%
In-depth Efficiency Analysis
Revenue generated per employee:
555.4K
Each employee generates -5% less revenue than industry average revenue per employee
EBITDA generated per employee:
79.4K
Each employee generates -53% less EBITDA than industry average revenue per employee
Profit generated per employee:
33.8K
Each employee generates -69% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
12.7K
Each employee generates -26% less free cash flow than industry average revenue per employee
Assets/Capital per employee
321.2K
Each employee generates -26% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 12.26%
Growth rate in R&D investment/expenditure is -48.19% lower than the industry
Competitors/Peer firms of
VECO
EPLUS INC. (XNAS:PLUS)
INTAPP, INC. (XNAS:INTA)
PUBMATIC, INC. (XNAS:PUBM)
NETLIST, INC. (OTCM:NLST)
INDIE SEMICONDUCTOR, INC. (XNAS:INDI)
Sumo Logic Inc (XNAS:SUMO)
DOMO, INC. (XNAS:DOMO)
MLACW
SECUREWORKS CORP. (XNAS:SCWX)
Current Analyst Ratings
Strong buy�8%
Buy�17%
Hold�13%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
605.99M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
352.62M
253.37M
90.95M
-
87.17M
-
11.44M
189.56M
2.30M
24.49M
25.48M
86.57M
63.81M
36.87M
36.60M
- 273.00K
36.87M
Statement of Cash Flow
Date:
Period:
6.24M
Differed Income Tax :
- 16.00K
Stock Based Compensation :
4.48M
Change in Working Capital :
515.00K
Accounts Receivables:
-
Other Working Capital:
- 585.00K
Other Non-Cash Items:
238.00K
Net Cash Provided by Operating Activities:
24.79M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
- 2498.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
127.62M
103.28M
230.90M
125.08M
179.07M
34.90M
569.95M
131.93M
181.94M
31.40M
-
1.64M
3.50M
350.41M
-
920.36M
56.15M
24.47M
5.61M
61.89M
78.18M
220.70M
286.25M
9.85M
296.10M
-
516.79M
513.00K
- 655412.00K
661.0K
1.06B
March 31, 2022 at 6:00:00 AM
542.18M
403.57M
920.36M
-
310.72M
183.1M
2.26M
- 10918.00K
- 11156.00K
-
-
-
-
- 5789.00K
- 5789.00K
- 3.00K
7.84M
128.31M
120.47M
24.79M
- 10918.00K
13.87M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
VECO
2023
2024
2025
2026
2027
$21.56
$38.96
$42.36
$46.06
$50.08