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1. Company Snapshot

1.a. Company Description

Advanced Energy Industries, Inc.designs, manufactures, sells, and supports precision power conversion, measurement, and control solutions worldwide.It offers plasma power solutions, including direct current (DC), pulsed DC, low frequency alternating current, high voltage, and radio frequency (RF) power supplies, as well as RF power supplies, RF matching networks, and RF instrumentation products; and remote plasma sources for reactive gas applications.


The company also provides power control modules and thermal instrumentation products for rapid thermal processing, chemical vapor deposition, epitaxy, crystal growing, and chemical processing, as well as metal, carbon fiber, and glass manufacturing and other industrial power applications; high voltage DC-DC products for semiconductor wafer processing and metrology, electrostatic clamping of substrates, scientific instrumentation, mass spectrometry, and X-ray systems for industrial and analytical applications; and low voltage DC-DC board mounted solutions for use in healthcare, telecommunications, test and measurement, instrumentation, and industrial equipment applications, as well as distributed power in server and storage systems.In addition, it offers gas sensing and monitoring products for the energy market, air quality monitoring, and automobile emission monitoring and testing; and embedded power products for medical equipment or IEC 60950-1 for information technology equipment.Further, it offers conversions, upgrades, and refurbishments and used equipment to companies, as well as repair services.


The company provides its products through a direct sales force, independent sales representatives, channel partners, and distributors.Advanced Energy Industries, Inc.was incorporated in 1981 and is headquartered in Denver, Colorado.

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1.b. Last Insights on AEIS

Advanced Energy Industries' recent performance was driven by strong Q4 earnings, with EPS jumping 49% and revenue climbing 18% year-over-year. The company's data center computing segment surged, fueled by AI-driven demand. Analysts increased their forecasts after the strong Q4 earnings report, and Stifel Nicolaus raised its price target to $310.00, citing a buy rating. Institutional investors, such as Envestnet Asset Management Inc., also increased their positions, with a 6.8% stake acquisition. The company's Q4 results beat estimates, showcasing margin expansion.

1.c. Company Highlights

2. Advanced Energy's Strong 2025 Performance and Bullish 2026 Outlook

Advanced Energy's (AE) fourth-quarter revenue reached $489 million, a 6% sequential increase and 18% year-over-year growth, driven by strengthening demand in the semiconductor, industrial, and medical markets. Gross margin came in at nearly 40%, the best performance in five years, while earnings per share (EPS) of $1.94 beat estimates of $1.77. For the full year 2025, AE grew total revenue by over 20%, increased EPS by more than 70%, and significantly improved gross and operating margins. The company's strong financial performance underscores the benefits of its diversification strategy and focus on execution.

Publication Date: Feb -15

📋 Highlights
  • 2025 Financial Performance:: Revenue reached $490M, 20% YoY growth with 70% EPS increase, and gross margin exceeded 40%—best in five years.
  • Q4 2025 Revenue Surge:: Generated $489M, up 18% YoY, with semiconductor revenue at $212M and data center computing hitting a record $178M (101% YoY growth).
  • 2026 Growth Guidance:: Projects high-teens revenue growth after 21% in 2025, with data center revenue expected to grow >30%, supported by modular tech and capacity expansions in Thailand.
  • Margin Expansion:: Gross margin improved 60 bps in Q4, targeting >40% in 2026, driven by manufacturing efficiency and product mix optimization.
  • Industrial & Medical Recovery:: Segment revenue grew 10% sequentially to $78M in Q4, with 2% YoY growth, and expects acceleration in 2026 due to improved demand and design wins.

Segment Performance

Semiconductor revenue was $212 million, up 8% from Q3, driven by customer demand strengthening. Data center computing revenue reached a record $178 million, up 4% sequentially and 101% year over year. Industrial and medical revenue increased 10% sequentially to $78 million and grew 2% year over year, the first increase in two years. AE's diversified portfolio and strong demand across markets drove the outperformance.

Outlook and Guidance

AE expects positive demand trends across all target markets in 2026, with multiple new wins ramping to production. In semiconductor, stronger customer forecasts are increasing confidence in a strong second half. Data center revenue is projected to grow more than 30% in 2026, driven by modular technology blocks and strong design teams. The company expects 2026 revenue to grow in the high teens, with expanding margins and a solid balance sheet.

Valuation and Metrics

With a current P/E Ratio of 79.63 and EV/EBITDA of 50.83, AE's valuation reflects high growth expectations. The company's ROE of 11.51% and ROIC of 7.26% indicate a strong ability to generate returns. As AE continues to execute on its growth strategy, its valuation metrics will be closely watched to determine if the current price reflects the company's future prospects.

Operational Highlights

AE maintained a solid cadence of new product introductions in 2025, with 26 new product launches across markets. The company continues to receive positive feedback on its Everest, EVOS, and NavX technologies in the semiconductor market. With a strong design win pipeline and investments in new product development, AE is well-positioned for continued growth.

3. NewsRoom

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Channing Capital Management LLC Has $64.05 Million Stock Position in Advanced Energy Industries, Inc. $AEIS

Feb -22

Source: defenseworld.net

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Are Computer and Technology Stocks Lagging Advanced Energy Industries (AEIS) This Year?

Feb -19

Source: zacks.com

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Caprock Group LLC Makes New Investment in Advanced Energy Industries, Inc. $AEIS

Feb -19

Source: defenseworld.net

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Best Momentum Stocks to Buy for February 17th

Feb -17

Source:

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New Strong Buy Stocks for February 17th

Feb -17

Source: zacks.com

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Why Shares in This Under-the-Radar Data Center Stock Power Surged 16% Today

Feb -11

Source: fool.com

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Advanced Energy Q4 Earnings Beat Estimates, Revenues Up Y/Y

Feb -11

Source: zacks.com

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Advanced Energy Industries Analysts Increase Their Forecasts After Strong Q4 Earnings

Feb -11

Source: benzinga.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.24%)

6. Segments

Semiconductor Equipment

Expected Growth: 8%

Advanced Energy Industries, Inc.'s Semiconductor Equipment segment growth is driven by increasing demand for 5G and IoT devices, rising adoption of artificial intelligence and machine learning, and growing need for advanced semiconductor manufacturing technologies. Additionally, the company's strong relationships with leading chipmakers and its innovative product portfolio contribute to its 8% growth.

Industrial and Medical

Expected Growth: 6%

Advanced Energy Industries, Inc.'s Industrial and Medical segment growth is driven by increasing demand for plasma etch and deposition technologies in semiconductor manufacturing, as well as growing adoption of medical devices and equipment. Additionally, the company's focus on innovation and R&D investments in these areas has contributed to its 6% growth rate.

Data Center Computing

Expected Growth: 9%

Advanced Energy Industries' Data Center Computing segment growth is driven by increasing demand for cloud computing, artificial intelligence, and 5G networks, leading to higher server shipments and rising need for power management and thermal management solutions. Additionally, the shift towards hybrid and edge computing is fueling growth, as data centers require more efficient and reliable power solutions.

Telecom and Networking

Expected Growth: 5%

Advanced Energy Industries, Inc.'s Telecom and Networking segment growth is driven by increasing demand for 5G infrastructure, rising adoption of IoT devices, and growing need for high-speed data transmission. Additionally, the shift towards remote work and virtual communication is fueling growth in this segment, with a 5% growth rate.

7. Detailed Products

Power Supplies

Advanced Energy's power supplies provide high-voltage, high-current, and high-frequency power conversion solutions for plasma-based applications.

Radio Frequency (RF) Generators

Advanced Energy's RF generators provide high-power, high-frequency energy for plasma-based applications.

Matching Networks

Advanced Energy's matching networks provide impedance matching solutions for plasma-based applications.

Sputtering Sources

Advanced Energy's sputtering sources provide high-performance, high-reliability sputtering solutions for thin film deposition applications.

Thermal Instrumentation

Advanced Energy's thermal instrumentation provides temperature measurement and control solutions for industrial applications.

Gas Flow Control

Advanced Energy's gas flow control solutions provide precise gas flow control and measurement for industrial applications.

8. Advanced Energy Industries, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Advanced Energy Industries, Inc. is medium due to the availability of alternative energy sources and technologies.

Bargaining Power Of Customers

The bargaining power of customers for Advanced Energy Industries, Inc. is low due to the company's strong brand reputation and customer loyalty.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Advanced Energy Industries, Inc. is medium due to the company's dependence on a few key suppliers for critical components.

Threat Of New Entrants

The threat of new entrants for Advanced Energy Industries, Inc. is high due to the growing demand for renewable energy solutions and the increasing number of new entrants in the market.

Intensity Of Rivalry

The intensity of rivalry for Advanced Energy Industries, Inc. is high due to the competitive nature of the industry and the presence of established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 44.93%
Debt Cost 3.95%
Equity Weight 55.07%
Equity Cost 11.63%
WACC 8.18%
Leverage 81.58%

11. Quality Control: Advanced Energy Industries, Inc. 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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Advanced Energy Industries

A-Score: 4.3/10

Value: 0.6

Growth: 5.0

Quality: 6.5

Yield: 0.0

Momentum: 9.5

Volatility: 4.3

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A-Score: 3.9/10

Value: 6.9

Growth: 4.3

Quality: 3.4

Yield: 2.0

Momentum: 3.0

Volatility: 4.0

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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

331.23$

Current Price

331.23$

Potential

-0.00%

Expected Cash-Flows