inTEST Corporation Up 128% in 2021 on High Semiconductor Demand

Overlooked inTEST Stock Has Great Momentum

inTEST Corporation (NYSEAMERICAN:INTT) has been one of the better-performing semiconductor stocks since the broader stock market bottomed in March 2020.

Since bottoming in March 2020, inTEST stock has bounced by an eye-watering 597%. It has also rallied by 352% year-over-year. While the pace of many tech stocks has slowed in 2021, the same cannot be said for inTEST Corporation. INTT stock is up 128% year-to-date.

The optimism for inTEST stock comes on the heels of solid financial results, a strong outlook, and increased demand for semiconductors used for artificial intelligence (AI), machine learning (ML), and the Internet of Things (IoT).

On top of that, the often-overlooked inTEST Corporation has been developing new products for growth markets.

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Chart courtesy of StockCharts.com

INTT Stock Overview

With a market cap of $156.6 million, inTEST is pretty small when it comes to the semiconductor industry. But the company has lofty goals: to solve technical challenges that others can’t—thermally, mechanically, and electronically. (Source: “Quarter Ended March 31, 2021: Investor Relations Presentation,” inTEST Corporation, May 7, 2021.)

inTEST designs and manufactures thermal, mechanical, and electronic products that are used by semiconductor manufacturers in conjunction with automated testing equipment in the testing of integrated circuits.

The company operates two business divisions: EMS Products Segment (EMS stands for electronic manufacturing services) and Thermal Segment.

The EMS Products Segment makes testing more efficient through “easy manipulation of test heads weighing hundreds of pounds, and secure docking and signal interfacing with automated test equipment.” (Source: Ibid.)

The Thermal Segment provides thermal systems that are used to test how semiconductors operate in different conditions, whether it be extreme or volatile temperatures.

Its thermal products are used in markets including automotive, aerospace, defense, electronics, fiber optic, machining, medical, and semiconductor. The segment has also been making headway in emerging markets, including electric vehicles and cannabis extraction.

The company’s blue-chip customer base includes Cisco Systems Inc (NASDAQ:CSCO), Intel Corporation (NASDAQ:INTC), Lockheed Martin Corporation (NYSE:LMT), Tesla Inc (NASDAQ:TSLA), and Toyota Motor Corp (NYSE:TM).

Solid Financial Results & Outlook

For the first quarter of fiscal 2021, ended March 31, inTEST announced that its revenue increased by 74% year-over-year and 31% sequentially to $19.6 million. Its bookings went up by 83% year-over-year and 43% sequentially to $25.2 million. (Source: “inTEST Reports 2021 First Quarter Financial Results,” inTEST Corporation, May 7, 2021.)

The company reported first-quarter net income of $2.2 million ($0.21 per share), compared to a first-quarter 2020 net loss of $1.1 million ($0.11 loss per share) and a fourth-quarter 2020 net loss of $400,000 ($0.04 loss per share).

inTEST’s first-quarter 2021 adjusted net income was $2.5 million ($0.24 per share), versus a first-quarter 2020 adjusted net loss of $800,000 ($0.08 loss per share) and a fourth-quarter 2020 adjusted net loss of $100,000 ($0.08 loss per share).

For the second quarter of 2021, inTEST expects to report:

  • Net revenue between $20.0 and $21.0 million, compared to $13.3 million in Q2 2020
  • Earnings per share between $0.20 and $0.24, compared to $0.02 in Q2 2020
  • Adjusted net income between $0.23 and $0.27, compared to $0.05 in Q2 2020

Analyst Take

inTEST Corporation is an overlooked semiconductor stock that has been trouncing the market. That’s thanks in large part to momentum that has, according to management, “continued unabated.” This resulted in the company reporting great first-quarter results and providing a bright outlook.

All of that is helping inTEST stock set the stage for both near- and long-term growth.