Nanometrics Incorporated Net Income surged on 90.9% and Revenue jumped on 25.5%
02/05/2019 • About Nanometrics Incorporated (
$NANO) • By InTwits
Nanometrics Incorporated reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- Nanometrics Incorporated is a fast growth stock: FY2018 revenue growth was 25.5%, 5 year revenue CAGR was 17.6% at FY2018 ROIC 23.4%
- EBITDA Margin is expanding: 22.6% in FY2018 vs. 19.2% in FY2017 vs. -1.1% in FY2014
- EBITDA Margin is quite volatile: 22.6% in FY2018, 19.2% in FY2017, 16.9% in FY2016, 7.5% in FY2015, -1.1% in FY2014
- Nanometrics Incorporated has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.4%. At the same time it's a lot of higher than industry average of 7.6%.
- CAPEX is quite volatile: $9m in FY2018, $7m in FY2017, $4m in FY2016, $2m in FY2015, $6m in FY2014
- The company has highly profitable business model: ROIC is 23.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 25.5%. Revenue growth showed slowdown in FY18Q4 - it was -1.5% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 0.63 pp from 3.1% to 3.7% in 2018. EBITDA Margin grew at 5.9 pp per annum in FY2014-FY2018.
Gross Margin increased on 3.9 pp from 52.9% to 56.7% in FY2018. Gross Margin followed a growing trend at 2.4 pp per annum in the last 5 years. SG&A as a % of Revenue decreased slightly on 0.75 pp from 22.1% to 21.4% in FY2018. SG&A as a % of Revenue declined at -2.3 pp per annum in FY2014-FY2018.
Net Income margin increased on 6.1 pp from 11.7% to 17.8% in FY2018.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 2.9% in FY2018. CAPEX/Revenue increased slightly on 1.9 pp from 0.99% in FY2015 to 2.9% in FY2018. It's average CAPEX/Revenue for the last three years was 2.5%. During FY2014-FY2018 CAPEX as a % of Revenue bottomed in FY2015 at 0.99% and was growing since that time.
Return on investment
The company operates at high and attractive ROIC (23.4%) and ROE (20.0%). ROIC increased on 5.6 pp from 17.8% to 23.4% in FY2018. ROE increased on 8.1 pp from 11.9% to 20.0% in FY2018. ROIC grew at 7.4 pp per annum in FY2014-FY2018.
Leverage (Debt)
The company has no debt. Cash jumped on 218%.
Valuation and dividends
The company's trades at EV/EBITDA 8.3x and P/E 12.5x.
Management team
The company's CEO is Pierre Yves Lesaicherre. Pierre Yves Lesaicherre is a founder and has 1 year tenure with the company.
Financial and operational results
FY ended 12/29/2018
Nanometrics Incorporated ($NANO) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 166.4 | 187.4 | 221.1 | 258.6 | 324.5 | 25.5% |
| Gross Profit | 78.5 | 89.7 | 114.1 | 136.7 | 184.1 | 34.7% |
| SG&A | 51.0 | 50.5 | 53.6 | 57.2 | 69.3 | 21.2% |
| EBITDA | -1.9 | 14.0 | 37.4 | 49.7 | 73.3 | 47.5% |
| Net Income | -31.1 | 2.9 | 44.0 | 30.2 | 57.6 | 90.9% |
Balance Sheet
|
|---|
| Cash | 34.7 | 38.2 | 47.1 | 34.9 | 111.0 | 217.9% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 5.8 | 1.8 | 4.0 | 7.2 | 9.5 | 31.7% |
Ratios
|
|---|
| Revenue growth | 15.3% | 12.6% | 18.0% | 17.0% | 25.5% | |
| EBITDA growth | -85.4% | -844.9% | 166.2% | 33.0% | 47.5% | |
|
|---|
| Gross Margin | 47.2% | 47.9% | 51.6% | 52.9% | 56.7% | 3.9% |
| EBITDA Margin | -1.1% | 7.5% | 16.9% | 19.2% | 22.6% | 3.4% |
| SG&A, % of revenue | 30.6% | 27.0% | 24.2% | 22.1% | 21.4% | -0.7% |
| Net Income Margin | -18.7% | 1.6% | 19.9% | 11.7% | 17.8% | 6.1% |
| CAPEX, % of revenue | 3.5% | 1.0% | 1.8% | 2.8% | 2.9% | 0.1% |
|
|---|
| ROIC | -6.0% | 2.7% | 14.0% | 17.8% | 23.4% | 5.6% |
| ROE | -16.1% | 1.6% | 20.4% | 11.9% | 20.0% | 8.1% |
| Net Debt/EBITDA | | -2.7x | -1.3x | -0.7x | -1.5x | -0.8x |
Nanometrics Incorporated ($NANO) key quoterly financial indicators
| mln. $ | FY18Q1 | FY18Q2 | FY18Q3 | FY18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 82 | 89 | 77 | 77 | | 38.8% | 37.5% | 35.1% | -1.5% |
| EBITDA | 22 | 22 | 16 | 13 | | 202.7% | 81.3% | 73.8% | -38.9% |
| Net Income | 16 | 18 | 12 | 12 | | 206.1% | 113.3% | 100.7% | 11.4% |
Balance Sheet
|
|---|
| Cash | 66 | 86 | 96 | 111 | | 39.0% | 103.5% | 118.2% | 217.9% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 57.7% | 57.4% | 57.0% | 54.6% | | 9.8% | 5.3% | 2.9% | -1.6% |
| EBITDA Margin | 27.1% | 25.3% | 20.8% | 16.6% | | 14.7% | 6.1% | 4.6% | -10.1% |
| Net Income Margin | 19.9% | 19.9% | 15.1% | 15.6% | | 10.9% | 7.1% | 4.9% | 1.8% |
Peers in Semiconductor Equipment
Below you can find Nanometrics Incorporated benchmarking vs. other companies in Semiconductor Equipment industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Atomera Incorporated ($ATOM) | | | | | 123.6% |
| ACM Research, Inc. ($ACMR) | | | -12.3% | 33.4% | 104.5% |
| SCI Engineered Materials Inc ($SCIA) | | -13.0% | -32.1% | 24.4% | 67.0% |
| Aehr Test Systems ($AEHR) | | -49.1% | 44.7% | 30.3% | 56.4% |
| SolarEdge Technologies, Inc. ($SEDG) | | 144.0% | 50.7% | 23.9% | 54.4% |
| |
|---|
| Median (37 companies) | | -2.0% | 6.5% | 24.7% | 14.0% |
|---|
| Nanometrics Incorporated ($NANO) | | 12.6% | 18.0% | 17.0% | 25.5% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | 99.5% | 99.8% | 99.8% | 98.3% | 96.7% |
| KLA-Tencor Corporation ($KLAC) | 57.9% | 56.8% | 61.0% | 63.0% | 64.1% |
| Teradyne, Inc. ($TER) | 53.3% | 55.8% | 54.7% | 57.2% | 58.1% |
| Nova Measuring Instruments Ltd. ($NVMI) | 52.7% | 51.9% | 45.9% | 59.1% | 57.8% |
| Rudolph Technologies, Inc. ($RTEC) | 52.7% | 53.9% | 53.1% | 52.8% | 54.2% |
| |
|---|
| Median (38 companies) | 34.4% | 38.3% | 37.3% | 43.2% | 40.2% |
|---|
| Nanometrics Incorporated ($NANO) | 47.2% | 47.9% | 51.6% | 52.9% | 56.7% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 29.2% | 26.4% | 34.4% | 38.3% | 39.6% |
| DAQO New Energy Corp. ($DQ) | 32.9% | 31.6% | 43.3% | 49.1% | 36.1% |
| Xperi Corporation ($XPER) | 66.7% | 67.5% | 47.6% | 23.4% | 34.3% |
| Lam Research Corporation ($LRCX) | 21.1% | 20.3% | 23.2% | 27.6% | 32.0% |
| Cabot Microelectronics Corporation ($CCMP) | 21.6% | 22.6% | 23.4% | 27.2% | 31.5% |
| |
|---|
| Median (37 companies) | 7.0% | 10.3% | 11.4% | 16.0% | 16.2% |
|---|
| Nanometrics Incorporated ($NANO) | -1.1% | 7.5% | 16.9% | 19.2% | 22.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Rubicon Technology, Inc. ($RBCN) | 15.0% | 4.0% | 3.6% | 0.0% | 58.8% |
| DAQO New Energy Corp. ($DQ) | 42.2% | 44.7% | 29.5% | 19.8% | 47.4% |
| AXT Inc ($AXTI) | 2.4% | 5.4% | 3.4% | 21.6% | 39.6% |
| STR Holdings Inc ($STRI) | 7.9% | 8.1% | 1.6% | 9.0% | 36.6% |
| Photronics, Inc. ($PLAB) | 20.0% | 19.8% | 10.4% | 20.4% | 17.3% |
| |
|---|
| Median (37 companies) | 2.2% | 2.9% | 2.6% | 3.2% | 3.0% |
|---|
| Nanometrics Incorporated ($NANO) | 3.5% | 1.0% | 1.8% | 2.8% | 2.9% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 17.9% | 16.5% | 27.2% | 34.0% | 39.9% |
| Lam Research Corporation ($LRCX) | 10.7% | 10.9% | 11.8% | 18.7% | 33.9% |
| Versum Materials, Inc. ($VSM) | | 26.2% | 32.4% | 30.0% | 32.1% |
| Advanced Energy Industries, Inc. ($AEIS) | 8.8% | 30.2% | 41.2% | 45.7% | 31.3% |
| SolarEdge Technologies, Inc. ($SEDG) | -815.6% | 33.6% | 31.2% | 26.5% | 28.6% |
| |
|---|
| Median (39 companies) | 3.5% | 6.0% | 6.9% | 12.2% | 11.2% |
|---|
| Nanometrics Incorporated ($NANO) | -6.0% | 2.7% | 14.0% | 17.8% | 23.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | -0.3x | -0.1x | 4.2x | 5.0x | 2.6x |
| Ultra Clean Holdings, Inc. ($UCTT) | -1.2x | 1.5x | 0.4x | -0.2x | 2.4x |
| Ichor Holdings ($ICHR) | 3.1x | 1.7x | -0.4x | 2.0x | 1.8x |
| Versum Materials, Inc. ($VSM) | -0.2x | -0.1x | 2.7x | 2.1x | 1.4x |
| DAQO New Energy Corp. ($DQ) | 4.6x | 4.3x | 2.3x | 0.9x | 1.2x |
| |
|---|
| Median (31 companies) | -1.2x | -1.0x | -1.3x | -0.7x | -1.0x |
|---|
| Nanometrics Incorporated ($NANO) | | -2.7x | -1.3x | -0.7x | -1.5x |
