UBS initiates Technoprobe coverage at “buy,” highlights AI-driven growth

Investing.com -- UBS has initiated coverage of Technoprobe SpA (BIT:TPRO) with a "buy” rating and a €10.40 price target, citing the company’s market position in semiconductor test equipment and rising demand for probe cards in artificial intelligence (AI) chip testing.

The brokerage said Technoprobe controls roughly 30% of the global probe card market, a critical component for testing advanced logic chips. 

UBS noted that “Technoprobe is well positioned to benefit from the rising testing opportunity in AI chips,” estimating that AI-related revenue will grow from €220 million in 2025 to €330 million in 2026, making up 40% to 50% of company sales.

UBS analysts projected that custom application-specific integrated circuits (ASICs) developed by hyperscalers, set for release in 2026, will be complex enough to require Technoprobe’s vertical MEMS probe cards. 

“We expect earnings momentum to drive the share higher,” the brokerage wrote in its coverage initiation.

Beyond AI GPUs and ASICs, UBS pointed to Technoprobe’s expansion into high bandwidth memory (HBM) testing. 

It estimated a $600 million total addressable market for HBM probe cards by 2028, with Technoprobe likely to capture 20% of that share.

First revenue contributions from HBM are expected in 2026, with more meaningful growth from 2027 onward.

The analysts noted Technoprobe’s balance sheet strength, highlighting a €660 million cash position and a history of acquisitions that have enabled the company to vertically integrate operations. 

“M&A to support growth in new markets but likely to weigh on margins,” UBS cautioned, projecting operating leverage to lift EBITDA margins toward 38% to 40% by 2028, though deal activity could act as a drag.

Financially, UBS estimates Technoprobe’s revenues will rise from €621 million in 2025 to €776 million in 2026 and further to €982 million by 2028. 

Net earnings are expected to more than double from €81 million in 2025 to €168 million in 2026, reaching €254 million by 2028. Diluted earnings per share are forecast at €0.13 in 2025, €0.27 in 2026 and €0.40 in 2028.

Technoprobe trades at 19x forward EV/EBITDA, in line with its historical average and slightly below peers at 20x, despite earnings growth expectations of more than 20% annually through 2028. 

UBS set its €10.40 price target using a discounted cash flow model with a 9% weighted average cost of capital and 3% growth assumption. 

“We see scope for a re-rating along with positive earnings momentum as the market looks through to 2026,” the brokerage said.

UBS added that potential catalysts include qualification updates at Technoprobe’s third-quarter results and 2026 guidance during fourth-quarter reporting. 

The brokerage’s earnings per share forecasts for 2026-28 are 11% to 25% above consensus, underlining its conviction on upside.

The coverage underscores Technoprobe’s role as a key supplier of testing solutions as semiconductor complexity accelerates, with UBS positioning the stock as a beneficiary of structural demand from AI and advanced memory applications.