Where I’ve been and where I’m going

Hi Vince, I’d suggest that you read the last earnings result and conference call, which explain it better than I could. I’ll try, but this is simplistic: Basically what they do is this: the chips off the manufacturing line have a small (say 1%) failure rate at the high temperatures of use. But that’s not an acceptable rate. You can’t have 1% of your devices fail (think self-driving cars, for instance).

Aehr sells machines that test the chips at high temperatures, and then sells whatever is needed to make the machines work (razor and razor blade model).

They are just starting to see their business volume explode. Here’s a paraphrased quote from the rather euphoric CEO at the end of the conference call.

(In response to an analyst’s congratulations). Thank you. And you know what, if you walk around this building, there’s a lot of happy, proud people here, because it’s funny. We all believed it. Everybody has been working their b-tt off, like “if we build it, they will come” and we just believed in our hearts that this would play out and for heavens sake, sometimes it works out. (Wow!!!)

And we are seeing it’s not just silicon. I think silicon carbide will go down as the one thing that was sort of the one that really pushed the industry over to widely adopt wafer level burn-in, but then it’s going to – we are already seeing people saying, well, if you use it for silicon, can I use it for this as well. So it’s been a long time coming and we have a long way to go. It’s really exciting. Thank you. (Wow again!!!)

the “Wows” are mine. But read the results and the conference call.



I deleted two messages here. The first because it was totally inappropriate, attacking an external fund manager (not connected with the MF), with words like “charlatan” and “fake.” The second post was challenging the first but unfortunately quoted those inappropriate accusations in his challenge, so I had to delete that too.



Hi Saul,

I have no problem with that but I really did want to know where he received his information. Because if true that would be explosive and something everyone should know. But if just a wild claim than the poster should be chastised for being so careless.



I will simply say that there are several of us on TMF who tried that service and left it shaking our heads.


Just to clarify. This board has rules and is thus different from other places you may have posted in the past. Our board is for the analysis of our companies in a collegial way, and you’ll notice that while we sometimes disagree about a company, we generally don’t argue in an angry way about them, we just agree to disagree.

Including a personal attack on a tech analyst (or anyone else), with name calling, just doesn’t belong on our board.



MAS4R, I was one of them :frowning:, but let’s end this discussion here.


it looks like your traditional saas cloud exposure is around 41.5% based on mndy (13.5), s (10+), bill (10+), zs (7), snow (1).

can you shed light on why you trimmed snow so aggressively.


Hi stryker, I thought that I was being clear when I started this thread that I was being more reasonable about taking evaluation into account. Just for instance

Enphase, Aehr, TradeDesk, and Bill had PE’s of 31, 45, 62, and 91. Snow’s was 704.

Enphase, Aehr, and Bill had PEG’s of 0.48, 0.69, and 1.44. Snowflake’s was 13.00.

Sentinel, Bill, Enphase and Aehr had EV/R’s of 6.8, 9.6, 11.4 and 11.5. Snowflake’s was 26.1.

Snow was so ridiculously out of line with my other companies, and were restating their guidance down as well, that I decided I had better places for my money.

I could be wrong, and I certainly can change my mind.



@SaulR80683 I really appreciate your response and have sold snow as a result. another eye opener is that the current price is overvalued even at 2028 eps giving p/e of 52.6!


EDIT: this is a reply to Striker:

Not that I am an expert but the profitability profile of ENPH is off the charts:

229,000$ profit per employee (non-Gaap) and 175,000 on Gaap basis
close to 70% return on equity

revenue per employee is over 900,000!

Yet for all of that it is in hypergrowth mode.

But it depends what you are looking for. If you 1/ think that SNOW is the “surest of sure things” in the world of SaaS and in general, and if you 2/ have a long time horizon, then the current profitability metrics do not matter.

I am not personally comfortable with the full package of SNOW metrics, rather than profitability per se, and glancing at the headline I am quite surprised it is not -25% right now considering that ENPH, which has much better current timeframe metrics, lost about that much. But there is lots of luck involved in the share price movement in the very short term (like a quarter).

In short, I don’t know that ENPH or SNOW is better, I think they are both outstanding but in different ways and on different time horizons.


Saul, been looking at AEHR, and the customer concentration seems kind of scary - 82% of its revenue came from one company (Onsemi, NASDAQ:ON) in 2022, 94% of revenue came from just two customers in the past quarter as well as nine months YTD - any worries that Onsemi could just decide to suddenly pull its commitment and go with a different vendor or in house?


It certainly would be possible, and disastrous, but I would think unlikely, besides which they just signed up two new customers who they hope will come on board by the end of the year if I remember correctly… Unlikely because they are the only one who can do what they do, and they appear to be very well patented. Also unlikely because a car manufacturer will ask the chip company “Who is guaranteeing that your chips won’t burn out while our cars are cruising down the road?” and the chip company won’t want to say “Oh, we are trying a new company that says they can do the testing 10% cheaper…” No, they will stick with Aehr.


Saul is correct.

The customer concentration risk is real, but part of the thesis is Aehr has added two new customers it believes have a chance to scale to a similar size as Onsemi. As I understand it, the contracts are signed but no revenue is recognized until the final test burns are complete.

At this point we have no reason to think those contracts won’t start to show up within the next quarter or two. That revenue recognition also has the potential to lead to a significant raise to any FY guide.


What do we think of pitting these companies against a NVDA benchmark, after their blowout earnings?

Using Evercore analyst’s above numbers from the tweet: NVDA nongaap last fiscal year 2022 EPS was $3.33. The estimated fiscal year 2023 EPS was $4.49.

Now today, we have EPS estimate for this fiscal year 2023 of $8.01. (That is a 78% jump above previous consensus of $4.49)

Premarket price is $390. Using last fiscal year eps, PE ratio is 117, and now forward EPS growth rate of 140.5%.

So currently the PEG is 0.836. Its forward PE is 48.7 for a company that is now expected to grow revenues 63% this 2023 fiscal year.

Let me know if these calculations are wrong, but if I got it right…then what is the case to NOT include NVDA in the portfolio even at this ‘outrageous’ all time price of $390/share, and choose to instead rather stay only in TTD, BILL, ENPH etc which are all growing topline way slower?

If we choose to follow the numbers alone….it seems like NVDA should now be the clear poster child of a true, very profitable, wide moat, hypergrowth company for this board.


I can think of two compelling reasons to not include NVDA in [at least my] portfolio:

  1. Law of large numbers
  2. lessons from completely ignoring valuation on the board in 2021**

**Heck, even Saul is now grudgingly admitting that valuation matters!


To be clear I was playing a Devil’s advocate about NVDA’s valuation post earnings. It looks reasonable for the expected growth. I don’t plan on buying any at this time.

Not sure I understand your point number 2, as I was trying to convey NVDA may actually be just as cheap as the other growth stocks mentioned here.