Overview
Needham has increased its 12-month price objective for Advanced Energy Industries to $330 from $290 while retaining a Buy recommendation. The adjustment follows a quarter in which the company outperformed expectations on the top and bottom lines and updated its near-term outlook. At the time of the latest pricing, the stock was trading at $279.04, roughly 1% below its 52-week high of $283.72. Over the trailing 12 months the stock has appreciated 151.28%.
Quarterly results and margins
Advanced Energy reported fourth-quarter revenue of $489 million, topping consensus estimates of $473.11 million. Earnings per share for the quarter were $1.94, above the forecast of $1.78 and at the upper end of management guidance. Year-over-year revenue increased 18% for the quarter, beating consensus growth expectations of 14% and exceeding the high end of the company’s guidance. Over the last twelve months, overall revenue growth was 17.19%, while gross profit margin measured 38.02%.
Segment performance and guidance
The semiconductor business was the primary driver of the quarter’s outperformance, with revenue for the segment rising 7.6% quarter-over-quarter, versus expectations for a modest decline. The Data Center segment performed in line with projections. For the first quarter, management guided to revenue growth of 24% year-over-year at the midpoint, above consensus estimates of 16%, noting continued strength in the semiconductor segment. Looking further ahead, company management projected total revenue growth in the high teens for 2026, with Data Center Computing (DCC) expected to grow at better than 30%.
Analyst model adjustments
In light of the stronger-than-expected quarter and the company’s guidance, Needham has raised its estimates for Advanced Energy’s 2026 and 2027 results materially. The firm’s revised price target reflects these higher model inputs and the updated growth outlook across key end markets.
Market reaction and context
Despite the positive earnings surprise, the stock experienced a slight decline in after-hours trading following the release of results. Investors and analysts are focusing on the company’s reported outperformance and the implications of management’s multi-year revenue targets as they reassess valuations and forward estimates.
Conclusion
Needham’s move to raise the price target to $330 while maintaining a Buy rating is anchored to Advanced Energy’s robust quarterly execution, above-consensus revenue and EPS, and a management outlook that anticipates continued semiconductor strength and rapid growth in Data Center Computing. The firm’s raised 2026 and 2027 estimates reflect these developments.