Aehr Test Profit Margin vs. Return On Equity

AEHR Stock  USD 16.51  0.22  1.35%   
Based on Aehr Test's profitability indicators, Aehr Test Systems is performing exceptionally good at this time. It has a great probability to showcase excellent profitability results in January. Profitability indicators assess Aehr Test's ability to earn profits and add value for shareholders.

Aehr Test Net Profit Margin

0.53

As of 12/29/2024, Price To Sales Ratio is likely to grow to 5.26. Also, Days Sales Outstanding is likely to grow to 73.40. At this time, Aehr Test's Interest Income is relatively stable compared to the past year. As of 12/29/2024, Net Interest Income is likely to grow to about 2.5 M, though Accumulated Other Comprehensive Income is likely to grow to (150.1 K).
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.320.4915
Way Down
Slightly volatile
For Aehr Test profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Aehr Test to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Aehr Test Systems utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Aehr Test's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Aehr Test Systems over time as well as its relative position and ranking within its peers.
  

Aehr Test's Revenue Breakdown by Earning Segment

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Is Semiconductors & Semiconductor Equipment space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Aehr Test. If investors know Aehr will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Aehr Test listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.88)
Earnings Share
0.98
Revenue Per Share
2.029
Quarterly Revenue Growth
(0.36)
Return On Assets
0.0305
The market value of Aehr Test Systems is measured differently than its book value, which is the value of Aehr that is recorded on the company's balance sheet. Investors also form their own opinion of Aehr Test's value that differs from its market value or its book value, called intrinsic value, which is Aehr Test's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Aehr Test's market value can be influenced by many factors that don't directly affect Aehr Test's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Aehr Test's value and its price as these two are different measures arrived at by different means. Investors typically determine if Aehr Test is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Aehr Test's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Aehr Test Systems Return On Equity vs. Profit Margin Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Aehr Test's current stock value. Our valuation model uses many indicators to compare Aehr Test value to that of its competitors to determine the firm's financial worth.
Aehr Test Systems is number one stock in profit margin category among its peers. It is rated fifth in return on equity category among its peers reporting about  0.58  of Return On Equity per Profit Margin. The ratio of Profit Margin to Return On Equity for Aehr Test Systems is roughly  1.73 . At this time, Aehr Test's Net Profit Margin is relatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value Aehr Test by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Aehr Return On Equity vs. Profit Margin

Profit Margin measures overall efficiency of a company and shows its ability to withstand competition as well as defend against adverse conditions such as rising costs, falling prices, decline in sales or management distress. Profit margin tells investors how well the company executes on its overall pricing strategies as well as how effective the company in controlling its costs.

Aehr Test

Profit Margin

 = 

Net Income

Revenue

X

100

 = 
0.50 %
In a nutshell, Profit Margin indicator shows the amount of money the company makes from total sales or revenue. It can provide a good insight into companies in the same sector, as well as help to identify trends of a company from year to year.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Aehr Test

Return On Equity

 = 

Net Income

Total Equity

 = 
0.29
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.

Aehr Return On Equity Comparison

Aehr Test is currently under evaluation in return on equity category among its peers.

Aehr Test Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Aehr Test, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Aehr Test will eventually generate negative long term returns. The profitability progress is the general direction of Aehr Test's change in net profit over the period of time. It can combine multiple indicators of Aehr Test, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-158 K-150.1 K
Operating Income10.1 M10.6 M
Income Before Tax12.5 M13.1 M
Total Other Income Expense Net2.4 M2.5 M
Net Income33.2 M34.8 M
Income Tax Expense-20.7 M-19.7 M
Net Income Applicable To Common Shares16.7 M17.6 M
Net Income From Continuing Ops33.2 M34.8 M
Non Operating Income Net Other2.3 M2.4 M
Interest Income2.4 M2.5 M
Net Interest Income2.4 M2.5 M
Change To Netincome2.6 M2.8 M
Net Income Per Share 1.15  1.21 
Income Quality 0.05  0.06 
Net Income Per E B T 2.66  2.79 

Aehr Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Aehr Test. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Aehr Test position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Aehr Test's important profitability drivers and their relationship over time.

Use Aehr Test in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Aehr Test position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Aehr Test will appreciate offsetting losses from the drop in the long position's value.

Aehr Test Pair Trading

Aehr Test Systems Pair Trading Analysis

The ability to find closely correlated positions to Aehr Test could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Aehr Test when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Aehr Test - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Aehr Test Systems to buy it.
The correlation of Aehr Test is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Aehr Test moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Aehr Test Systems moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Aehr Test can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Aehr Test position

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Additional Tools for Aehr Stock Analysis

When running Aehr Test's price analysis, check to measure Aehr Test's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Aehr Test is operating at the current time. Most of Aehr Test's value examination focuses on studying past and present price action to predict the probability of Aehr Test's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Aehr Test's price. Additionally, you may evaluate how the addition of Aehr Test to your portfolios can decrease your overall portfolio volatility.

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