NY State Common Retirement Fund Holds $5.97M Position in Aehr Test Systems

February 12, 2024: The New York State Common Retirement Fund (NYSCRF), one of the world’s largest public pension funds, revealed a $5.97 million position in Aehr Test Systems (NASDAQ: AEHR) as of September 30, 2023. This disclosure, made within the NYSCRF’s quarterly 13F filing with the Securities and Exchange Commission (SEC), highlights growing institutional interest in the semiconductor test equipment manufacturer.

Aehr Test Systems designs and manufactures equipment used to test integrated circuits (ICs) throughout various stages of production. While not a household name, the company caters to a critical niche within the semiconductor industry, serving major players like Apple, Qualcomm, and Nvidia.

Several potential factors influenced the NYSCRF’s decision to invest in Aehr Test Systems. Firstly, the semiconductor industry stands poised for continued growth, fueled by increasing demand for electronic devices and advancements in artificial intelligence and automotive technology. This rising demand translates to a need for efficient and reliable IC testing solutions, potentially propelling growth for Aehr Test Systems.

Secondly, Aehr boasts a strong track record of innovation. The company’s flagship products, the FOX and NexGen testers, offer advanced functionalities and cater to emerging trends like 5G and chiplets. This commitment to innovation could bode well for future development and market share expansion.

However, potential risks associated with the investment must also be considered. The semiconductor industry is inherently cyclical, and Aehr Test Systems is susceptible to downturns in demand. Additionally, the company faces competition from larger players within the test equipment space.

Furthermore, Aehr Test Systems remains a relatively small company with approximately $500 million in market capital. This size can translate to greater volatility in its stock price compared to larger, more established entities.

The NYSCRF’s investment in Aehr Test Systems is a testament to the company’s potential within the growing semiconductor testing market. However, understanding the underlying rationale and associated risks is crucial for investors evaluating their investment decisions. Continued monitoring of Aehr Test Systems’ performance, industry trends, and competitive landscape will be vital in assessing the long-term viability of this investment choice.