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Tokyo Electron Ltd 8035 Stock Quote

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Morningstar‘s Stock Analysis 8035

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Is it the right time to buy or sell?

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Tokyo Electron Reiterates Its Positive Outlook Despite Macro and Supply Headwinds; No Change to FVE

Abhinav Davuluri, CFA Sector Strategist

Analyst Note

| Abhinav Davuluri, CFA |

Tokyo Electron recorded fiscal first-quarter revenue slightly below our expectations, which we attribute to supply chain disruptions and component shortages. Nonetheless, the firm maintained its full-year growth outlook at about 17%. Similar to peers, management lowered calendar 2022 wafer fab equipment, or WFE, growth from 20% to a range of 5%-15%. We believe any WFE demand not fulfilled this year because of supply chain issues will be shipped in calendar 2023. By application, industry logic and foundry spending is expected to be up 10%-20% year over year thanks to investments by the likes of TSMC and Intel. In contrast, DRAM spending is expected to be down 5% year over year versus up 15% last quarter. NAND is expected to grow 10% year over year as customers move to 200-layer-plus 3D NAND. We think memory spending will fall in calendar 2023 as macro conditions worsen. We are maintaining our fair value estimate for narrow-moat Tokyo Electron at JPY 50,000. Shares look fairly valued at current levels.

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Key Statistics 8035

Company Profile 8035

Business Description

Tokyo Electron is a major vendor of semiconductor fabrication tools. It operates primarily in the etch, deposition, and clean segments, which involve adding and removing materials to and from semiconductor wafers. Customers include leading-edge logic, foundry, and memory chipmakers such as Intel, TSMC, Micron, and Samsung.

Akasaka Biz Tower, 3-1 Akasaka 5-chome
Tokyo, 107-6325, Japan
T +81 355617000
Industry Semiconductor Equipment & Materials
Most Recent Earnings Jun 30, 2022
Fiscal Year End Mar 31, 2022
Stock Type
Employees 15,634