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1. Company Snapshot

1.a. Company Description

SÜSS MicroTec SE, together with its subsidiaries, develops, manufactures, and markets machines for the production of microelectronics, microelectromechanical systems, and related applications.It operates through five divisions: Photomask Equipment, Lithography, Bonder, Microoptics, and Others.The company develops, manufactures, and sells mask aligners, coaters and developers, UV projection scanners, and laser processing tool.


It develops, produces, and sells bonder systems, including microelectromechanical systems, compound semiconductors, and 3D integration markets.In addition, the company develops, manufactures, and sells specialized tools for the cleaning and processing of photomasks for the semiconductor industry.Further, it is involved in the production and sale of micro lenses and specialized optics for various industrial applications.


It operates in Europe, the Middle East, Africa, North America, and the Asia Pacific.The company distributes its products through production facilities, as well as through distribution companies and trade representatives.SÜSS MicroTec SE was founded in 1949 and is headquartered in Garching, Germany.

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1.b. Last Insights on SMHN

SÜSS MicroTec SE's recent performance was hindered by a decline in market capitalization, with a €108m loss in the last 7 days. The company's share price volatility is a concern, despite a 301% increase in shareholder value over 5 years. Furthermore, the stock's performance has been lackluster, with no significant catalysts driving growth. The absence of recent positive news, such as a successful earnings release or a notable acquisition, has contributed to the company's underperformance.

1.c. Company Highlights

2. SUSS MicroTec's Q3 Earnings: A Mixed Bag with Margin Pressures

SUSS MicroTec SE reported Q3 sales of EUR 118 million and a gross profit margin of 31.7% in Photomask Solutions, significantly impacted by an unfavorable product mix. The company's 9-month sales reached EUR 384 million, or 78% of the midpoint of their sales forecast. Earnings per share (EPS) came in at 0.4803, beating estimates of 0.2417. The gross profit margin was under pressure, mainly due to special effects such as extra expenses for training and supply chain efforts in Taiwan (EUR 3.2 million), a write-down on discontinued technology projects (EUR 2.2 million), and expenses for the new site in Zhubei (EUR 1.2 million).

Publication Date: Nov -20

📋 Highlights
  • Q3 Sales & Order Intake:: Reported EUR 118 million sales, with low EUR 70 million order intake but expects >EUR 100 million in Q4 driven by AI demand.
  • Gross Profit Impact:: Gross margin dropped to 31.7% due to EUR 16 million in special costs (training, supply chain, site expenses) and an unfavorable product mix.
  • Free Cash Flow Potential:: Q3 free cash flow was negative EUR 0.7 million, but full-year guidance remains at EUR 28 million, with Q4 likely to contribute positively.
  • 2025 Guidance Adjustments:: Reduced gross profit and EBIT margin ranges; aims for EUR 30 million OpEx run rate, down from current upper-20s, with EBIT margin above mid-range.
  • Regional & Product Shifts:: China order share fell to 18.4%, while Taiwan rose to 40%; EUR 140 million 2026 backlog, with new scanner and wafer cleaning product launches planned for 2025.

Operational Performance

The company's order intake was low at EUR 70 million in Q3, but they expect orders exceeding EUR 100 million in Q4, driven by AI-related orders. Management stated that the expected order increase in Q4 is not purely seasonal, but driven by activity in the AI space picking up again. The order backlog stands at EUR 140 million, with EUR 20 million in service and upgrade business.

Margin Expectations

The company reduced their guidance ranges for gross profit margin and EBIT margin for 2025. Management aims to improve their margin performance, but it will likely be lower than in 2024. The EBIT margin is likely to end up above the middle of its range. The company's current OpEx run rate is in the upper 20s, but with double costs in Taiwan; a run rate of EUR 30 million is targeted for next year.

Valuation and Outlook

With a P/E Ratio of 9.62 and an EV/EBITDA of 6.68, the stock appears to be reasonably valued. The company's ROE stands at 20.05%, indicating strong profitability. For 2025, analysts estimate revenue growth at -12.2%. The company's guidance for next year includes a sales and gross margin range. The new scanner generation will be launched mid-next year, with the broad launch towards the end of next year, potentially driving growth.

Cash Flow and Debt

The company's free cash flow from continuing operations was minus EUR 0.7 million in Q3, but they expect to generate around EUR 28 million of free cash flow for the full year. The Net Debt / EBITDA ratio stands at -0.44, indicating a healthy debt position.

3. NewsRoom

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Why Analysts See a Shift in the SUSS MicroTec Story After Recent Upgrades and Growth Targets

Nov -27

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SUSS MicroTec (ETR:SMHN) Strong Profits May Be Masking Some Underlying Issues

Nov -14

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How Recent Shifts Are Rewriting the Story for SUSS MicroTec

Nov -02

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Estimating The Intrinsic Value Of SUSS MicroTec SE (ETR:SMHN)

Oct -31

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With 61% ownership of the shares, SUSS MicroTec SE (ETR:SMHN) is heavily dominated by institutional owners

Oct -12

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Declining Stock and Solid Fundamentals: Is The Market Wrong About SUSS MicroTec SE (ETR:SMHN)?

Sep -03

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When Should You Buy SUSS MicroTec SE (ETR:SMHN)?

Jul -25

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Calculating The Intrinsic Value Of SUSS MicroTec SE (ETR:SMHN)

May -24

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.73%)

6. Segments

Advanced Backend Solutions

Expected Growth: 12%

Advanced Backend Solutions from SÜSS MicroTec SE is driven by increasing demand for semiconductor manufacturing, growing adoption of IoT and AI technologies, and rising need for miniaturization and precision in chip production. Additionally, the segment benefits from the company's strong R&D capabilities, strategic partnerships, and expanding presence in key markets such as Asia and the US.

Photomask Solutions

Expected Growth: 10%

The 10% growth of Photomask Solutions from SÜSS MicroTec SE is driven by increasing demand for advanced semiconductor manufacturing, adoption of EUV lithography, and growing need for high-precision photomasks in emerging technologies like 5G, AI, and IoT. Additionally, strategic partnerships, investments in R&D, and expansion into new markets also contribute to this growth.

MicroOptics

Expected Growth: 16%

MicroOptics' 16% growth is driven by increasing demand for advanced semiconductor manufacturing technologies, particularly in the areas of 5G, IoT, and autonomous vehicles. SÜSS MicroTec's strong market position, innovative product portfolio, and strategic partnerships also contribute to this growth.

Corporate Functions

Expected Growth: 8%

SÜSS MicroTec SE's Corporate Functions segment growth of 8% is driven by increasing demand for semiconductor manufacturing equipment, expansion into new markets, and strategic investments in research and development. Additionally, the company's focus on operational efficiency and cost reduction initiatives have contributed to the segment's growth.

7. Detailed Products

Lithography

SÜSS MicroTec SE offers a range of lithography products, including mask aligners, proximity lithography systems, and UV-NIL systems, used for patterning and structuring of semiconductor materials, MEMS, and nanotechnology applications.

Wafer Bonding

SÜSS MicroTec SE provides wafer bonding systems for the fabrication of advanced semiconductor devices, including 3D stacked devices, MEMS, and sensors.

Coating

SÜSS MicroTec SE offers a range of coating products, including spin coaters, spray coaters, and evaporators, used for the deposition of thin films and materials in semiconductor, MEMS, and nanotechnology applications.

Inspection and Metrology

SÜSS MicroTec SE provides inspection and metrology systems for the detection of defects and measurement of critical dimensions in semiconductor, MEMS, and nanotechnology applications.

Bonder and Debonder

SÜSS MicroTec SE offers bonder and debonder systems for the temporary bonding and debonding of wafers, used in the production of advanced semiconductor devices and MEMS.

8. SÜSS MicroTec SE's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for SÜSS MicroTec SE is moderate due to the presence of alternative technologies and products in the semiconductor industry.

Bargaining Power Of Customers

The bargaining power of customers for SÜSS MicroTec SE is low due to the company's strong relationships with its customers and the customized nature of its products.

Bargaining Power Of Suppliers

The bargaining power of suppliers for SÜSS MicroTec SE is moderate due to the presence of multiple suppliers in the market, but the company's dependence on a few critical suppliers.

Threat Of New Entrants

The threat of new entrants for SÜSS MicroTec SE is low due to the high barriers to entry in the semiconductor industry, including significant capital requirements and technological expertise.

Intensity Of Rivalry

The intensity of rivalry for SÜSS MicroTec SE is high due to the competitive nature of the semiconductor industry, with multiple players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 4.80%
Debt Cost 3.95%
Equity Weight 95.20%
Equity Cost 14.09%
WACC 13.60%
Leverage 5.05%

11. Quality Control: SÜSS MicroTec SE passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Elmos

A-Score: 4.9/10

Value: 4.5

Growth: 6.4

Quality: 7.5

Yield: 1.9

Momentum: 7.0

Volatility: 2.3

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X-FAB Silicon Foundries

A-Score: 4.6/10

Value: 7.3

Growth: 7.3

Quality: 3.8

Yield: 0.0

Momentum: 7.5

Volatility: 1.7

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SÜSS MicroTec

A-Score: 4.3/10

Value: 8.2

Growth: 8.9

Quality: 7.9

Yield: 0.6

Momentum: 0.5

Volatility: 0.0

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First Sensor

A-Score: 4.3/10

Value: 2.9

Growth: 3.8

Quality: 6.6

Yield: 1.2

Momentum: 1.5

Volatility: 9.7

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Oxford Instruments

A-Score: 4.0/10

Value: 2.3

Growth: 4.7

Quality: 6.2

Yield: 1.2

Momentum: 4.0

Volatility: 5.3

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Valens Semi

A-Score: 2.9/10

Value: 7.8

Growth: 4.3

Quality: 4.3

Yield: 0.0

Momentum: 1.0

Volatility: 0.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

39.04$

Current Price

39.04$

Potential

-0.00%

Expected Cash-Flows