12 Small-Cap Semiconductor Stocks to Buy Now

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2. Veeco Instruments Inc. (NASDAQ:VECO)

Market Capitalization: $1.4 billion

Number of Hedge Funds: 24

Veeco Instruments Inc. (NASDAQ:VECO) is a manufacturer of advanced process equipment and solutions for the semiconductor and advanced packaging industries. The company specializes in manufacturing systems for the deposition of thin films, which are critical in the production of high-performance electronic devices. Its product portfolio includes ion beam, laser annealing, single wafer wet processing, molecular beam epitaxy (MBE) systems, atomic layer deposition (ALD) systems, and other advanced manufacturing technologies. The company’s customers are mainly concentrated in four end-markets: semiconductor, compound semiconductor, data storage, and scientific & other.

On January 6, 2025, Citi analyst upgraded Veeco Instruments Inc. (NASDAQ:VECO)’s rating from Neutral to Buy, setting a target price of $33. The analyst believes that the company is nearing a cyclical low, indicating a potential recovery from current levels. His favourable outlook was based on the company’s expanding Serviceable Available Market (SAM) and advancements in laser annealing and nanosecond annealing technologies, which are expected to benefit from the industry’s transition towards gate-all-around (GAA) transistors, backside power, and high bandwidth memory (HBM) technologies. AI-related semiconductor revenue contribution to Veeco Instruments Inc. (NASDAQ:VECO)’s total revenue is projected to double from 10% in 2024 to 20% in 2025, driven by advancements in wet processing technology. Additionally, the analyst believes that the company’s current valuation already accounts for a potential sharp decline in the data storage segment anticipated for 2025.

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