Hi Yard man,
2025 looks to be when the turnaround shows up with orders.
Historically the Q 4 and Q1 are the weaker quarters. Both PC's and mobile phones are great Christmas gifts.
Q 2 and Q 3 are often when a new laptop or phone have had production ramps.
It is yet to be seen how the High Band Width memory test gets a ramp.
This is a very new and possibly important new product. IT IS THEIR FIRST ATTEMPT AT GETTING NTO MEMORY. IN THE VERY EARLY YEARS CHUCK SCHWANN (THE CEI int he 19870's and 1980's bought Daymarc. Day marc had Micron as a customer, but that diminshed.
It will be interesting to see how big Neon can become in the ramp of AI chips. Definitely a great move to get into the fab footprint of AI chips!
Cohu has a long history of reinventing themselves and finding new innovative products.
Luis Muller comes from Teradyne, which has been quite aggressive in expanding their manufacturing expertise in new products that have expanded beyond the testing devices that Cohu feeds chips to be tested by their testers with Cohu's handlers and sorters.
Let's hope their Neon become the tester of design in all chip makers. The neon for handling SiC's is a 50 million addressable market. We need several more 50 million adressable markets and we'll be feeling much better about our investments.
The bipartison Chip Act will sooner or later become a boost in "new systems".
If Trump gets elected all of the side social issues should get truncated (DEI). The ramp of the chips act is said to have been slowly enacted as so many social plans were written into the money funding requirements. Some non US firms rejected the money as the extra social fluff was not considered doable or at least a hindrance to quick enactment.
Kudos the Cohu's management!
I think the turnaround is near.
If Q4 is still slow, there may well be a time to add to back of $24 -$25 with a 4-5% add to the position.
That's my plan anyhow.
I have a full position, but will "add to", as I view Cohu as a company with a solid balance sheet, with good margins and explosive earnings power, but trapped within the peaks and troughs of the chip cycles. It made me a millionaire as it was the only stock I owned and it exploded when a small company named Intel needed Cohu to evenly heat microprocessor processor chips which had metal connectors on all four sides of the chip, called a (quad flat pack" design. Cohu reinvented the chip handling design with their "Pick and Place) handling machines. As chip testing became more intense, Cohu had to again reinvent themselves. Instead of heating the chip, they had to cool the chip during the test cycle. If not cooled the chips would melt. When cooled the chips, performed better and they were graded in mega hertz. The higher the mega-hertz rating , the higher the price paid for the chips. The savings more than justified the cost of the handler.
With each peak and trough in the cycles of chip production, Cohu opportunistically acquired other types of handlers. Gravity, test on strip, turret. They now have a global dominant footprint. The recurring business is a great margin business that needs to be consolidated globally.
Here's to nice long turnaround for Cohu in 2025.
Bob
Bob |
