| Valuation method | Value, ¥ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 7726.89 | 4 |
| Intrinsic value (DCF) | 1537.77 | -79 |
| Graham-Dodd Method | 4390.25 | -41 |
| Graham Formula | 4907.43 | -34 |
Tera Probe, Inc. is a leading semiconductor testing services provider headquartered in Yokohama, Japan. Specializing in wafer testing, final testing, and test engineering, the company serves a global clientele with comprehensive solutions for DRAM, SoC, CPU, image sensors, and analog devices. As a subsidiary of Powertech Technology Inc., Tera Probe leverages advanced testing technologies, including test program cross-platform conversion and probe card development, to enhance semiconductor reliability and performance. Operating in the highly competitive semiconductor sector, Tera Probe plays a critical role in the supply chain by ensuring quality assurance for high-performance chips used in consumer electronics, automotive, and industrial applications. With a strong presence in Japan and expanding international operations, the company is well-positioned to capitalize on the growing demand for semiconductor testing amid increasing chip complexity and miniaturization trends.
Tera Probe presents a compelling investment opportunity within the semiconductor testing niche, supported by its strong revenue growth (JPY 37.1 billion in FY 2024) and solid net income (JPY 3.5 billion). The company benefits from its strategic position as a subsidiary of Powertech Technology Inc., providing stability and access to broader industry networks. However, investors should note the capital-intensive nature of the semiconductor testing industry, reflected in Tera Probe's significant capital expenditures (JPY -14.8 billion). The company's moderate beta (0.873) suggests relative stability compared to the broader semiconductor sector, while its dividend yield (JPY 110 per share) adds income appeal. Risks include exposure to cyclical semiconductor demand and dependence on a few key clients in a highly competitive market.
Tera Probe competes in the semiconductor testing and probe card services market, where differentiation is driven by technical expertise, testing accuracy, and turnaround time. The company's competitive advantage lies in its specialized testing services for advanced semiconductor devices, including SoCs and image sensors, which require high precision. Its subsidiary relationship with Powertech Technology provides access to integrated supply chain solutions, enhancing its value proposition for fabless semiconductor companies. However, Tera Probe faces intense competition from larger global players with broader geographic reach and more diversified service offerings. The company's focus on the Japanese market, while providing regional strength, may limit growth compared to competitors with stronger international footprints. Tera Probe's investment in test engineering and probe card development positions it well for the increasing complexity of semiconductor devices, but maintaining technological leadership will require sustained R&D spending in this rapidly evolving sector.