Financial Analysis: Aehr Test Systems (AEHR) and Cascade Microtech (CSCD)

Aehr Test Systems (NASDAQ: AEHR) and Cascade Microtech (NASDAQ:CSCD) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Aehr Test Systems and Cascade Microtech, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aehr Test Systems 0 0 0 0 N/A
Cascade Microtech 0 0 0 0 N/A

Insider & Institutional Ownership

27.2% of Aehr Test Systems shares are owned by institutional investors. 21.9% of Aehr Test Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Aehr Test Systems has a beta of 0.84, suggesting that its share price is 16% less volatile than the S&P 500. Comparatively, Cascade Microtech has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500.

Profitability

This table compares Aehr Test Systems and Cascade Microtech’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aehr Test Systems -13.92% -26.85% -12.73%
Cascade Microtech 5.72% 7.19% 5.97%

Earnings & Valuation

This table compares Aehr Test Systems and Cascade Microtech’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aehr Test Systems $18.90 million 3.53 -$5.65 million ($0.20) -15.50
Cascade Microtech N/A N/A N/A $0.72 30.36

Cascade Microtech has lower revenue, but higher earnings than Aehr Test Systems. Aehr Test Systems is trading at a lower price-to-earnings ratio than Cascade Microtech, indicating that it is currently the more affordable of the two stocks.

Summary

Cascade Microtech beats Aehr Test Systems on 6 of the 9 factors compared between the two stocks.

About Aehr Test Systems

Aehr Test Systems is engaged in the designing, manufacturing and marketing of advanced test and burn-in products to the semiconductor manufacturing industry. The Company manufactures and markets full wafer contact test systems, test during burn-in systems, test fixtures, die carriers and related accessories. The Company’s principal products are the Advanced Burn-In and Test System (ABTS), the FOX full wafer contact parallel test and burn-in systems, WaferPak full wafer contactor, the DiePak carrier and test fixtures. The Company develops, manufactures and sells systems, which are designed to reduce the cost of testing and to perform reliability screening, or burn-in, of complex logic devices, memory integrated circuits (ICs), sensors and optical devices. These systems can be used to perform parallel testing and burn-in of packaged ICs, singulated bare die or ICs still in wafer form.

About Cascade Microtech

Cascade Microtech, Inc. is a designer, developer, manufacturer and marketer of wafer probing, thermal and reliability solutions for the electrical measurement and testing of semiconductor devices. The Company operates in two business segments: Systems and Probes. The Systems business segment is engaged in the sale of probe stations, thermal subsystems and reliability test systems. The Probes segment is engaged in the sale of analytical probes and production probe cards. The Company designs, manufactures and sells multiple product lines, including probe stations, thermal subsystems, reliability test systems, analytical probes, production probe cards, and various services and accessories. Probing systems are used in the development of semiconductor processes and designs. The 1164 Reliability Test System is a modular and scalable test platform that can be used in a range of reliability test applications.

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