Cohu (NASDAQ:COHU) Shares Up 8% After Earnings Beat

Key Points

• Cohu’s earnings beat expectations: The semiconductor equipment maker reported adjusted EPS of $0.43 versus the $0.35 consensus, while revenue rose 37% year over year to approximately $173 million. Shares gained about 8% following the announcement.
• Growth outlook is strong: Management expects 30%–40% revenue growth next year and aims to triple shipments of its Eclipse thermal-management products, supported by AI and high-performance-computing demand.
• Analyst sentiment improved, but profitability remains a concern: Several firms raised price targets, contributing to a “Moderate Buy” consensus, although Cohu continues to report a negative net margin and return on equity.

Cohu, Inc. (NASDAQ:COHU - Get Free Report) was up 8% during mid-day trading on Thursday following a better than expected earnings announcement. The company traded as high as $57.69 and last traded at $57.39. 391,577 shares changed hands during mid-day trading, a decline of 65% from the average session volume of 1,116,054 shares. The stock had previously closed at $53.14.

The semiconductor company reported $0.43 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.35 by $0.08. The business had revenue of $172.96 million during the quarter, compared to analyst estimates of $170.25 million. Cohu had a negative net margin of 7.43% and a negative return on equity of 1.96%. Cohu's revenue for the quarter was up 37.0% on a year-over-year basis. During the same period in the previous year, the business posted ($0.06) earnings per share.

Trending Headlines about Cohu

Here are the key news stories impacting Cohu this week:

• Positive Sentiment: Q3 earnings beat estimates: Cohu reported adjusted earnings of $0.43 per share, above the $0.35 consensus estimate and substantially better than the $0.06-per-share loss recorded a year earlier. Revenue reached approximately $173.0 million, topping expectations of $170.25 million and rising 37% year over year. Cohu Q3 Earnings and Revenues Top Estimates
• Positive Sentiment: Strong 2027 outlook: Management expects 30% to 40% revenue growth next year and is targeting a threefold increase in shipments of its Eclipse thermal-management products. The forecast suggests improving demand for semiconductor test and thermal solutions. Cohu Expects 30%-40% 2027 Revenue Growth
• Positive Sentiment: AI and HPC demand is expanding: Cohu highlighted a high-performance computing pipeline of roughly $1 billion and increased bookings, reinforcing expectations that AI infrastructure spending could support future orders. Cohu Q3 Earnings Call Highlights
• Positive Sentiment: Analyst confidence improved: Stifel raised its price target to $75, while Needham reaffirmed its Buy rating with a $65 target. The revisions indicate analysts see additional upside following the earnings report. Cohu Price Target Raised at Stifel
• Neutral Sentiment: Despite the improved quarter, Cohu continues to show negative reported net margin and return on equity, so investors will watch whether the projected growth translates into sustained profitability.

Wall Street Analysts Forecast Growth

Several equities analysts recently issued reports on COHU shares. Robert W. Baird set a $83.00 price objective on Cohu in a research report on Thursday. Weiss Ratings reissued a "sell (d-)" rating on shares of Cohu in a report on Thursday, October 15th. Jefferies Financial Group reiterated a "buy" rating and issued a $90.00 price target on shares of Cohu in a research note on Thursday. Stifel Nicolaus boosted their target price on Cohu from $70.00 to $75.00 and gave the stock a "buy" rating in a research report on Thursday. Finally, B. Riley Financial increased their price target on shares of Cohu from $65.00 to $69.00 and gave the company a "buy" rating in a report on Friday, July 31st. One investment analyst has rated the stock with a Strong Buy rating, seven have given a Buy rating, one has given a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat.com, Cohu presently has a consensus rating of "Moderate Buy" and an average target price of $73.62.

Insider Activity at Cohu

In related news, Director Nina Richardson sold 3,055 shares of the company's stock in a transaction dated Wednesday, August 5th. The shares were sold at an average price of $51.54, for a total value of $157,454.70. Following the completion of the sale, the director owned 39,093 shares of the company's stock, valued at approximately $2,014,853.22. This represents a 7.25% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Andrew M. Caggia sold 15,252 shares of the stock in a transaction that occurred on Wednesday, August 5th. The stock was sold at an average price of $51.74, for a total value of $789,138.48. Following the completion of the transaction, the director owned 64,778 shares of the company's stock, valued at $3,351,613.72. The trade was a 19.06% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 134,999 shares of company stock worth $8,321,309 over the last 90 days. 3.05% of the stock is owned by insiders.

Hedge Funds Weigh In On Cohu

A number of institutional investors and hedge funds have recently added to or reduced their stakes in COHU. BlackRock Inc. acquired a new stake in shares of Cohu in the second quarter worth $545,932,000. The Manufacturers Life Insurance Company bought a new position in shares of Cohu during the second quarter worth about $77,814,000. Emerald Advisers LLC acquired a new stake in shares of Cohu during the 1st quarter valued at approximately $23,887,000. Paradigm Capital Management Inc. NY acquired a new position in shares of Cohu in the 2nd quarter valued at about $42,794,000. Finally, Segall Bryant & Hamill LLC boosted its position in Cohu by 125.5% during the 1st quarter. Segall Bryant & Hamill LLC now owns 955,344 shares of the semiconductor company's stock valued at $29,253,000 after purchasing an additional 531,661 shares during the period. 94.67% of the stock is owned by institutional investors and hedge funds.

Cohu Trading Up 7.9%

The firm's fifty day moving average price is $57.08 and its 200-day moving average price is $46.69. The company has a debt-to-equity ratio of 0.37, a current ratio of 5.74 and a quick ratio of 4.72. The company has a market cap of $2.71 billion, a price-to-earnings ratio of -69.64 and a beta of 1.51.

About Cohu

Cohu, Inc is a global provider of semiconductor test and inspection equipment and related services. The company supplies solutions used by semiconductor manufacturers and outsourced semiconductor assembly and test providers to evaluate devices during production, helping improve manufacturing quality, reliability and efficiency.

Cohu's product portfolio includes semiconductor test handlers, contactors and other interface products, inspection and metrology systems, thermal-management equipment, and software for test-data analysis and factory automation.

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