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Is VECO a good stock to buy? We came across a bullish thesis on Veeco Instruments Inc. on Valueinvestorsclub.com by go2bl93. In this article, we will summarize the bulls’ thesis on VECO. Veeco Instruments Inc.'s share was trading at $50.25 as of May 1st. VECO’s trailing and forward P/E were 85.17 and 29.94 respectively according to Yahoo Finance.

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Veeco Instruments Inc., together with its subsidiaries, develops, manufactures, sells, and supports semiconductor and thin film process equipment primarily to make electronic devices in the United States and internationally. VECO is positioned as a beneficiary of Axcelis Technologies’ (ACLS) all-stock acquisition, expected to close in 2H26 with VECO shareholders owning ~42% of the pro forma entity.

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The stocks trade in line with the deal ratio, reflecting high perceived completion probability pending China SAMR approval. Despite solid fundamentals, both names have materially underperformed semiconductor capital equipment peers, creating a pronounced valuation disconnect.

VECO operates across leading-edge logic, advanced packaging, memory, and HDD, with exposure to HBM, EUV mask blanks, and laser spike annealing. It guided CY26 revenue growth of ~16% and $1.68 non-GAAP EPS, materially above consensus, supported by backlog up ~35% y/y. VECO trades at ~18x CY26 EPS versus ~40x peers, implying significant re-rating potential given 15–20% WFE growth.

ACLS is concentrated in ion implant systems with exposure to mature nodes, power devices (SiC), and memory, where SiC is in a multi-year downturn but memory is positioned for cyclical recovery. On a pro forma basis, ~50% of earnings (VECO plus ACLS memory) tracks 15–20% WFE growth, with ~$35M synergies enhancing EPS. At ~20x 2026 EPS (17x ex-cash) versus ~40x peers, the combined entity remains deeply discounted. A 30x mid-cycle multiple implies ~60% upside as merger completion, synergies, and valuation normalization occur.

Previously, we covered a bullish thesis on Applied Materials, Inc. (AMAT) by Long-Term Pick in March 2025, which highlighted AI-driven semiconductor demand, advanced packaging strength, and gate-all-around adoption as key growth drivers. AMAT’s stock price has appreciated by approximately 146.44% since our coverage. go2bl93 shares a similar view but emphasizes Veeco Instruments (VECO)’s merger-driven mispricing with Axcelis Technologies (ACLS), focusing on pro forma valuation discount and synergy-led rerating potential.

Veeco Instruments Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 18 hedge fund portfolios held VECO at the end of the fourth quarter which was 21 in the previous quarter. While we acknowledge the risk and potential of VECO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than VECO and that has 10,000% upside potential, check out our report about this cheapest AI stock.

Disclosure: None.