Canaccord Keeps Neutral Stance On Veeco Instruments Following EPIK700 MOCVD System Release


In a research note released today, Canaccord analyst Jonathan Dorsheimer maintained a Hold rating on Veeco (NASDAQ:VECO) with a $33 price target, on the heels of the company’s official announcement of their new EPIK700 MOCVD system slightly.

The following bullets contain some highlights from this note:

  • Veeco has released their new EPIK700 MOCVD system slightly ahead of our expectations, signaling that at least one of Veeco’s beta partners for the new tool will be transitioning into commercial production.
  • We view the tool’s introduction to be a positive development as the new system will likely represent quicker margin expansion above the 40% range in our estimation.
  • The new tool will be selling at a higher ASP – we believe between $2M-$3M – and should stem some of the competitive pricing pressure that the company has been seeing from AIXTRON in recent years.
  • The EPIK700 represents a 2.5x throughput increase and approximately 20% cost savings to the customer compared to older tools. The company also notes that the system can drive higher yields and improve wavelength uniformity.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jonathan Dorsheimer has a total average return of 0.8% and a 37.5% success rate. Dorsheimer has a -19.0% average return when recommending VECO, and is ranked #1931 out of 3270 analysts.

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