ACMR's 2025 Top-Line View is Impressive: Buy or Hold the Stock?

ACM Research ACMR expects 2025 revenues between $850 million and $950 million, which indicates roughly 18% growth at the mid-point compared with 2024’s revised estimated range of $755-$770 million.  Strong demand for the company’s wafer processing solutions is the major driver. ACM expects continued investments from Mainland China customers on increasing capacity, which will keep demand for its products robust. ACMR also expects the impact of the U.S. component export restrictions on its supply chain to be manageable.ACMR shares have appreciated roughly 15% since Jan. 2 and 17% in the past month.ACMR Stock’s Performance Image Source: Zacks Investment Research Will the strong top-line growth estimate help ACMR gain momentum in 2025? Let’s dig deep to find out.ACM Research’s Prospects Ride on Strong PortfolioACMR’s cleaning business, which comprises single wafer cleaning, Tahoe and semi-critical clinical equipment, is used in 90% of all cleaning process steps. ACM Research’s top-to-bottom cleaning portfolio helps address a significant part of the market, which is worth roughly $6 billion.Improving demand for sulfuric acid peroxide mixing (SPM) offering, which represents roughly 25% of total front-end cleaning market, is helping ACMR gain market share in cleaning. The company remains on track to become the second only supplier of commercial high temperature SPM cleaning globally.ACMR’s Ultra C Tahoe solution is expected to benefit from the growing demand for environment-friendly AI chip manufacturing for AI. The Ultra C Tahoe’s enhanced capabilities are noteworthy, as it has achieved an average particle count of less than 6 particles at 26 nano size, meeting the stringent requirement for advanced node manufacturing. Ultra C Tahoe tool is also now capable of removing YX nanoparticles for the most advanced logic memory applications, with an additional smaller particle filtering system. It combines a batch wafer process and a single wafer cleaning chamber into the same SPM tool, delivering enhanced cleaning performance, high throughput and process flexibility with up to 75% reduction in chemical consumption. ACMR is expected to benefit from increasing shipments of its ACP furnace to other memory and analog customers. ACM Research anticipated having 17 furnace customers by the end of 2024, up from nine at the end of 2023. The company expects contribution to revenues from furnace to accelerate in 2025.Expanding International Footprint Aids ACMR’s Top LineACM Research benefits from an expanding international footprint, with a focus on winning new customers in the United States, Korea, Taiwan, Europe and other Asia markets. ACMR’s long-term target is to generate half of its revenues from outside of China. ACMR is expanding sales and services teams in the United States, Korea, Europe and South East Asia.Over the long term, China Service Addressable Market (SAM) is worth $5 billion, with cleaning, ECP, furnace, PECVD, track and advanced packaging SAM being $1.6 billion, $0.4 billion, $0.7 billion, $1.3 billion, $0.8 billion and $0.3 billion, respectively.Non-China SAM is estimated to be $11 billion, with cleaning, ECP, furnace, PECVD, track and advanced packaging SAM being $3.6 billion, $0.8 billion, $1.5 billion, $3 billion, $1.8 billion and $0.9 billion, respectively.The company expects to generate $3 billion in revenues over the long term. ACMR expanded production capacity with the acquisition of a 39,500-square-foot facility, including a 5,200-square-foot clean room in Oregon.ACMR’s Earnings Estimate Trends Are SteadyThe Zacks Consensus Estimate for 2025 earnings is pegged at $1.80 per share, unchanged over the past 30 days.ACMR’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 151.52%. ACM Research, Inc. Price and Consensus ACM Research, Inc. price-consensus-chart | ACM Research, Inc. Quote Find the latest EPS estimates and surprises on Zacks Earnings Calendar.ACMR Stock – Buy or Hold?ACM Research shares are trading above the 50-day and 200-day moving averages, indicating a bullish trend.ACMR Trades Above 50-Day and 200-Day SMA Image Source: Zacks Investment Research ACM Research stock is trading at a discount, as suggested by the Value Score of A.In terms of the forward 12-month Price/Sales, ACMR is trading at 1.13X, lower than its median of 1.41X and the sector’s 6.88X.Price/Sales (F12M) Image Source: Zacks Investment Research However, the slowdown in China’s advanced packaging market is a concern. U.S. export restrictions are a headwind for ACMR.ACM Research currently has a Zacks Rank #3 (Hold), which implies that investors should wait for a favorable time to accumulate the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ACM Research, Inc. (ACMR): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks