Critical Review: Aehr Test Systems (NASDAQ:AEHR) & ASM International (OTCMKTS:ASMIY)

ASM International (OTCMKTS:ASMIY) and Aehr Test Systems (NASDAQ:AEHR) are both technology companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.

Insider and Institutional Ownership

0.0% of ASM International shares are owned by institutional investors. Comparatively, 69.7% of Aehr Test Systems shares are owned by institutional investors. 24.4% of ASM International shares are owned by insiders. Comparatively, 4.6% of Aehr Test Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares ASM International and Aehr Test Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ASM International	31.94%	22.22%	16.33%
Aehr Test Systems	-14.25%	-3.83%	-3.36%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for ASM International and Aehr Test Systems, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ASM International	1	2	5	0	2.50
Aehr Test Systems	1	1	5	1	2.75

Aehr Test Systems has a consensus target price of $132.50, suggesting a potential upside of 134.10%. Given Aehr Test Systems’ stronger consensus rating and higher possible upside, analysts plainly believe Aehr Test Systems is more favorable than ASM International.

Volatility and Risk

ASM International has a beta of 2.03, suggesting that its share price is 103% more volatile than the S&P 500. Comparatively, Aehr Test Systems has a beta of 3.47, suggesting that its share price is 247% more volatile than the S&P 500.

Valuation & Earnings

This table compares ASM International and Aehr Test Systems”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ASM International	$3.59 billion	10.70	$818.79 million	$25.50	30.80
Aehr Test Systems	$50.00 million	36.97	-$7.13 million	($0.24)	-235.83

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

Summary

ASM International beats Aehr Test Systems on 7 of the 13 factors compared between the two stocks.

About ASM International

ASM International NV, together with its subsidiaries, engages in the research, development, manufacture, marketing, and servicing of equipment and materials used to produce semiconductor devices in Europe, the United States, and Asia. The company’s products include wafer processing deposition systems for atomic layer deposition (ALD), epitaxy, silicon carbide, plasma enhanced chemical vapor deposition (PECVD), and vertical furnace systems, including low pressure chemical vapor deposition (LPCVD), diffusion, and oxidation products, as well as provides spare parts and support services. It also manufactures and sells equipment, which is used in wafer processing, encompassing the fabrication steps in which silicon wafers are layered with semiconductor devices. The company offers its products to semiconductor manufacturers. The company was formerly known as Advanced Semiconductor Materials International NV. ASM International NV was incorporated in 1968 and is headquartered in Almere, the Netherlands.

About Aehr Test Systems

Aehr Test Systems provides test solutions for testing, burning-in, and semiconductor devices in wafer level, singulated die, and package part form, and installed systems worldwide. Its product portfolio includes FOX-XP and FOX-NP systems that are full wafer contact and singulated die/module test and burn-in systems that can test, burn-in, and stabilize range of devices, including silicon carbide-based and other power semiconductors, 2D and 3D sensors used in mobile phones, tablets and other computing devices, memory semiconductors, processors, microcontrollers, systems-on-a-chip, and photonics and integrated optical devices. The company also offers FOX-CP system, a low-cost single-wafer compact test solution for logic, memory, and photonic devices; FOX WaferPak Contactor, a full wafer contactor capable of testing wafers up to 300mm that enables integrated circuit manufacturers to perform test, burn-in, and stabilization of full wafers on the FOX-P systems. In addition, it provides FOX DiePak Carrier, a reusable temporary package that enables IC manufacturers to perform final test and burn-in of bare die and modules; and FOX DiePak Loader. The company was incorporated in 1977 and is headquartered in Fremont, California.