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On Wednesday, Kepler Cheuvreux began covering SUSS MicroTec SE (SMHN:GR), a supplier of equipment for semiconductor production, assigning the stock a "Hold" rating and setting a price target of EUR 40.00. The firm’s analysis suggests a cautious stance, reflecting a mix of the company’s strengths and potential challenges in the market.
The report acknowledges SUSS MicroTec’s past success, noting its role as an indirect beneficiary of the artificial intelligence (AI) expansion, which boosted demand for its temporary bonders. These bonders have been crucial for semiconductor giants like TSMC and leading memory manufacturers. However, Kepler Cheuvreux points out that the initial surge in demand is now showing signs of weakening.
Kepler Cheuvreux’s analysis delves into the specifics of wafer bonders and examines key factors influencing the company’s prospects. The report highlights SUSS MicroTec’s strong position in extreme ultraviolet (EUV) mask cleaning and its profitable legacy tools. Yet, it also points to uncertainties surrounding the timelines for hybrid bonding technology and the increasing competition in lithography.
The firm’s projections for SUSS MicroTec’s financial performance are conservative compared to the wider market consensus. Kepler Cheuvreux expects the company’s 2026 sales to be 5% lower than consensus estimates and its earnings before interest and taxes (EBIT) to be 19% below consensus. These figures are influenced by expectations of a more pronounced digestion of temporary bonding/detaching (TB/DB) equipment, a slower ramp-up of hybrid bonding (HB), and a milder growth in the photomask sector.
Looking ahead, potential positive developments for SUSS MicroTec could include the successful qualification of its HB tools by top-tier customers, increased adoption of its scanners in AI packaging, a convincing increase in wafer cleaning operations, and market share gains in advanced packaging among outsourced semiconductor assembly and test (OSAT) providers.
Kepler Cheuvreux’s initiation of coverage with a "Hold" rating and a EUR 40 price target reflects a balanced view of SUSS MicroTec’s opportunities and risks in the evolving semiconductor equipment industry.
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