FREMONT, CA – Aehr Test Systems, an established provider of semiconductor test and reliability qualification equipment, has completed the acquisition of Incal Technology, Inc., as per the details filed with the Securities and Exchange Commission today. The transaction, which was concluded on Monday, involved Aehr Test Systems purchasing all outstanding capital stock of Incal for a total consideration of $21 million.
The payment structure for the acquisition comprised $14 million in cash and the issuance of $7 million worth of Aehr Test Systems common stock. This equates to 552,355 shares, priced at $12.673 per share. The agreement also includes provisions for post-closing adjustments based on Incal's working capital.
Incal Technology, a fellow California corporation located in Fremont, specializes in the same industry as Aehr Test Systems, which is categorized under the Standard Industrial Classification code 3825, Instruments for Meas & Testing of Electricity & Elec Signals.
The acquisition, initially reported in a Current Report on Form 8-K filed on July 15, 2024, is expected to enhance Aehr Test Systems' product offerings and market reach. The transaction details were disclosed in a Form 8-K filing, which serves as an official notification of significant events that shareholders and the Securities and Exchange Commission should be informed about.
In other recent news, Aehr Test Systems has been making notable strides in the semiconductor industry. The company has reported robust fiscal 2024 earnings, with a fourth-quarter revenue of approximately $16.6 million and a GAAP net income of about $23.8 million. For the full fiscal year, Aehr's revenues were around $66.2 million, and the GAAP net income was nearly $33.1 million, surpassing both previous company guidance and analyst consensus.
Aehr Test Systems also completed the acquisition of Incal Technology, Inc., a move expected to enhance the company's product offerings and market reach. The transaction involved Aehr purchasing all outstanding capital stock of Incal for a total consideration of $21 million, including $14 million in cash and the issuance of $7 million worth of Aehr common stock.
In addition to the merger, Craig-Hallum has upgraded Aehr Test Systems' stock from Hold to Buy, setting a price target of $25.00. The analyst's outlook suggests confidence in the company's potential for growth and expansion in the coming years. The upgrade reflects a positive outlook on the company's diversification beyond its silicon carbide expansion narrative.
InvestingPro Insights
As Aehr Test Systems (NASDAQ:AEHR) finalizes its acquisition of Incal Technology, investors may find the following InvestingPro insights particularly relevant. Aehr Test Systems is trading at a low Price-to-Earnings (P/E) ratio of 14.27, which is noteworthy when considering its near-term earnings growth. This suggests that the company's stock may be undervalued relative to its earnings potential. Moreover, Aehr holds more cash than debt on its balance sheet, providing financial stability and flexibility in the wake of their recent acquisition.
On the performance front, Aehr Test Systems has experienced a strong return over the last month, with a 70.0% increase in its stock price. This positive momentum is extended over the last three months, with a 60.87% return. However, it's important to note that the company's net income is expected to drop this year, which could be a point of consideration for investors looking at long-term profitability.
For those interested in deeper analysis, InvestingPro offers additional insights and metrics on Aehr Test Systems, including valuation multiples and profitability ratios. In total, there are 15 more InvestingPro Tips available, which can be explored for a comprehensive understanding of the company's financial health and market position. Visit InvestingPro for more details.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.