One-glance verdict
Overvalued
$71.16 our estimate vs market $187.43
163% above our estimate, beyond the bull case
Fundamentals snapshot
Advantest Corporation
ATEYY · PNK · Technology · Semiconductor Equipment & Materials
Current price
$187.43
52-week range
$64.91 - $198.32
Market cap
$135.85B
Balance sheet
Healthy
43.20x Strong cushion
Net cash $1.99B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 60.3% last year.
- Reward Returns 57.6% on equity, ahead of 50% of its peers.
- Risk Stock trades 22230.2% above its 5-year average P/E.
- Risk Insider ownership is only 0.0% (peer median: 0.3%).
What this company does
Advantest Corporation
Advantest makes and sells the highly complex machines that computer chip companies use to test their products for flaws. These testers are essential for making sure the chips that power everything from your phone to advanced artificial intelligence systems work perfectly. As electronics become more powerful and complicated, the need for Advantest's precise testing equipment grows, making the company a key player in the global technology supply chain (the entire network of businesses involved in creating and delivering a product).
How the company got here
Advantest started in Japan in 1954, originally named Takeda Riken Industry Co., Ltd., making electronic measuring instruments. Seeing a future in the growing electronics industry, they moved into semiconductor testing in the 1970s. As the demand for personal computers and other electronics grew, so did Advantest, becoming a major player in the global market for semiconductor test equipment by 1985, the same year it changed its name to Advantest Corporation. A key move was acquiring its competitor Verigy in 2011, which significantly boosted its global presence and capabilities in testing complex chips.
What it actually does
Think of Advantest as a quality control specialist for the tiny electronic brains, called semiconductors or chips, that power everything from your smartphone to your car and the vast data centers behind the internet. Before these chips are sent out to be used in devices, they need to be tested to make sure they work perfectly. Advantest builds the highly advanced and expensive machinery that performs these crucial tests, ensuring the chips are reliable and meet performance standards. Their customers are the companies that manufacture these chips.
Semiconductor and Component Test System Business
This is Advantest's main business, making up the largest portion of its sales, around 70%. This division creates the sophisticated automated test equipment (ATE) that checks the functionality of different types of semiconductors. It's divided into two main areas: one for testing 'System-on-a-Chip' (SoC) testers, which are the complex processors in things like smartphones and computers, and another for memory testers, which check memory chips like those used for data storage. Chip manufacturers buy these systems to ensure their products work correctly before they are assembled into electronic devices.
Mechatronics-related Business
This segment provides the robotic machinery that works alongside the main testing systems. These are called handlers, and their job is to physically pick up individual chips, place them into the tester, and then sort them based on the test results. This automation is critical for the high-speed, high-volume manufacturing of semiconductors. This part of the business also includes other related mechanical and electronic products that support the testing process.
Services, Support and Others
This part of the company doesn't sell the main testing machines, but instead provides crucial services and support to the customers who own them. This includes maintenance, spare parts, and software solutions to keep the equipment running efficiently. It also includes a growing area called system-level testing, which tests how chips behave in environments that are very similar to the final products they will be used in. This segment provides a steady, recurring stream of revenue (income that is predictable and likely to continue in the future) for the company.
What management is betting on now
Advantest's leadership is heavily focused on the increasing demand for chips used in artificial intelligence (AI) and high-performance computing. They are also concentrating on the growing need for testing advanced types of memory chips that are essential for AI applications. The company aims to provide more comprehensive solutions that cover more of the testing process, not just the core equipment. Finally, they are working to build a more resilient supply chain (the network of companies that get products from the manufacturer to the customer) to avoid disruptions and to expand their recurring revenue through more services and support.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $71.16 vs current price $187.43
Our most-likely fair value is $71.16 a share — about 62.0% below today's price of $187.43, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $2.0B - more cash than debt. Interest coverage 43.2x.
Net debt
$-1.99B
Interest coverage
43.20x
Advantest Corporation's profit covers its interest bill about 43.2 times over. which is stronger than most peers shown here.
Healthy
Worse cushion
Baseline
Better cushion
ATEYY
BASELINE
Advantest Corporation
Total debt $125.73M Interest coverage 43.20x This is the baseline the peer rows are being compared against.
Total debt $82.40M Interest coverage 100.59x +133% vs ATEYY Carries about 2.3x more debt cushion than ATEYY.
Total debt $6.15B Interest coverage 16.59x -62% vs ATEYY Carries about 2.6x less debt cushion than ATEYY.
Total debt $7.27B Interest coverage 31.49x -27% vs ATEYY Carries about 1.4x less debt cushion than ATEYY.
Total debt $3.73B Interest coverage 33.11x -23% vs ATEYY Carries about 1.3x less debt cushion than ATEYY.
Total debt $31.89M Interest coverage 115.35x +167% vs ATEYY Carries about 2.7x more debt cushion than ATEYY.
What you should know
The case for and against ATEYY
3 Rewards
2 Risks
Rewards
-
Revenue grew 60.3% last year.
-
Returns 57.6% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Stock trades 22230.2% above its 5-year average P/E.
-
Insider ownership is only 0.0% (peer median: 0.3%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
58.21x
Forward P/E
—
P/B
27.34x
P/S
0.12x
EV/EBITDA
-0.35x
PEG ratio
2.20x
Profitability
How much profit each dollar creates
Gross margin
64.3%
Operating margin
46.7%
Net margin
33.3%
ROE
57.6%
ROA
30.8%
Health
Liquidity and balance-sheet strength
Debt / equity
0.03x
Current ratio
2.53x
Quick ratio
1.72x
Total debt
$125.73M
Total cash
$2.12B
Growth
How the business has been compounding
Revenue TTM
$7.03B
Revenue 5Y CAGR
23.2%
EPS TTM
3.22
EPS 5Y CAGR
24.9%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.78B
Free CF TTM
$1.66B
FCF margin
23.6%
Dividend
Shareholder payout
Yield
0.2%
Payout ratio
11.2%
Last ex-div date
2026-03-30