CAMT

Camtek is a semiconductor metrology and inspection equipment supplier benefiting directly from the advanced-packaging and AI-chip build-out. The operating fundamentals are excellent: FY2025 revenue grew 15.6% to $496M, gross margin held at a robust 50.5%, and operating income grew 18.6% to $128M (a 25.8% operating margin). The multi-year trajectory is strong — revenue has nearly doubled from $270M (FY2021) — driven by demand for inspection tools used in high-bandwidth-memory and advanced packaging for AI accelerators. Operating cash flow grew 16.1% to $142M on minimal capex ($14.4M), and the balance sheet remains solid with $178M cash, current assets ($897M) dwarfing current liabilities ($107M).

The headline that demands caution is the apparent collapse in net income — down 57.2% to $50.7M and diluted EPS down 57.0% to $1.04 — even as revenue and operating income grew strongly. This divergence almost certainly reflects a non-operating item: FY2024 net income of $119M was well above operating income that year, suggesting a one-time gain or tax benefit inflated the prior-year base, while FY2025 net income includes financing-related costs (total liabilities jumped 87.5%, consistent with a convertible/debt raise). The reported P/E of 187.7x is therefore distorted by depressed GAAP earnings; on operating income the business is far more reasonably profitable, but ROE of 8.2% is modest.