Aehr Test Systems Stock Soars 72% in a Month: Is it Still a Buy?

Over the past month, Aehr Test Systems, Inc. AEHR has surged 72.2%, easily beating the broader industry, which has gained 7.4%. The S&P 500 has risen 2.9% over the same period. Among comparable stocks, Teradyne, Inc. TER has advanced 11.3%, while Cohu, Inc. COHU has been flat.

The rally reflects a change in how investors view AEHR’s growth prospects. Record fourth-quarter fiscal 2026 bookings of $60.7 million and an effective backlog of about $100.6 million gave the market greater confidence in demand. The company expects significant fiscal 2027 revenue growth, supported by rising demand for semiconductor test and burn-in systems used in AI processors, silicon photonics and power devices.

AEHR One-Month Price Performance Comparison

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The expanding order pipeline is also improving revenue visibility, as AEHR moves several customer programs toward production. Together, the strong order momentum, substantial backlog and exposure to fast-growing AI and data-center applications are driving the stock higher.

Estimates for AEHR Signal Continued Growth

For fiscal 2027, the Zacks Consensus Estimate for Aehr Test Systems’ EPS is projected at 70 cents, a sharp increase from 3 cents a year ago. For fiscal 2028, the estimate is pegged at $1.54, indicating another 120% increase. Moreover, analysts project fiscal 2027 revenues of $140.20 million, up 180.4%, followed by $215.65 million in fiscal 2028, implying another 53.8% increase.

AEHR has topped earnings estimates in three of the past four quarters and met once, delivering an average earnings surprise of 321.9%.

Aehr Test Systems Price, Consensus and EPS Surprise

Aehr Test Systems price-consensus-eps-surprise-chart | Aehr Test Systems Quote

AI Leads a Broadening Growth Story

AEHR is currently benefiting from several overlapping growth drivers, with AI-related semiconductor testing emerging as the most important. Its lead hyperscale customer is ramping AI processors and increasing its need for the company’s wafer-level and package-level burn-in systems. Management expects this customer’s system purchases and WaferPak requirements to increase significantly over the next several years.

Silicon photonics is becoming a major new opportunity as AI data centers increasingly use optical I/O and high-speed interconnects. Aehr already has a lead silicon-photonics customer ramping production and a newer major networking customer forecasting additional systems for hyperscale deployments. In early August, the company received a follow-on production order from its lead silicon photonics customer for a fully automated FOX-XP multi-wafer burn-in system, scheduled to ship in the first half of 2027.

Recovery in silicon carbide, particularly for EVs, is another growth avenue, which provides diversification benefits. Aehr received more than $8 million of SiC orders in the month before its July results, including orders connected to automotive programs. Management also expects renewed GaN and SiC demand from AI data-center power infrastructure.

Aehr is pursuing wafer-level burn-in opportunities in memory, including NAND flash and potential high-bandwidth memory (HBM) applications. The company is working with multiple memory suppliers as they prepare additional capacity.

Cash Gives AEHR Room to Grow

AEHR's balance sheet provides a solid financial cushion, with cash and cash equivalents rising to $116.4 million as of May 29, 2026. The sizable cash position, bolstered by a public equity offering, should give the company flexibility to support capacity expansion and working-capital needs as it prepares for rapid growth in fiscal 2027.

Growth Comes at a Steep Price

The market is already assigning AEHR a premium for its growth potential. The stock currently trades at 24.62X forward sales, above the industry average of 6.32X and its three-year median multiple of 6.05X. That premium leaves less room for disappointment.

For comparison, Teradyne trades at 10.50X forward sales, while Cohu trades at 3.61X.

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Risks Investors Should Watch

AEHR’s biggest challenge is turning its opportunity into consistent financial results. The company depends on a relatively small group of large customers, with its lead hyperscale AI customer playing an especially important role. Delays in production ramps or changes in customer spending could make results volatile.

AEHR's business remains exposed to the capital-spending cycles of semiconductor manufacturers. Even though AI is creating strong demand, spending can be lumpy, and customer orders can shift between quarters.

Execution against elevated expectations remains a key risk. AEHR has an impressive backlog and significant AI opportunities, but the stock’s sharp run-up has raised the bar for future results. Investors will now want to see that the backlog translates into sustained revenue and earnings growth while AEHR simultaneously ramps manufacturing capacity.

Our Call: Buy AEHR Stock Now

Aehr Test Systems is entering fiscal 2027 with strong momentum, supported by record bookings, a sizable backlog and growing demand from AI, silicon photonics and power semiconductor markets. The sharp rise in earnings and revenue estimates further strengthens the growth case.

However, AEHR’s premium valuation and reliance on a limited number of large customers leave little room for execution missteps. Investors will be watching how quickly the company converts its backlog into revenues while expanding capacity to meet demand. Despite these risks, the strong growth outlook and favorable estimate trends support a Zacks Rank #1 (Strong Buy) for AEHR, reflecting an attractive near-term setup. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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