ACM Research's Rally Meets Reality After Weak Margins

2026-02-27 05:26:49 ET

ACM Research’s ( ACMR ) Q4 2025 numbers dropped, and then the stock closed 17% lower. That shift changed the risk/reward picture for this fast-growing chip equipment supplier. Last time I weighed in, stock was at $39.79; I called it a buy . That was based on solid margins, a balance sheet with no real red flags, and ACMR’s habit of either meeting or beating what it said it would do, even with all the noise around China policies. Since then, the stock jumped 72%, hit a high of $71.65 and ended up at $68.47 right before the Q4 report. That’s a big run; investors were willing to pay up because revenue kept speeding up, ACMR got added to the S&P SmallCap 600 and it kept beating its own guidance. But now, the latest quarter shows a messier risk setup. Margins are getting squeezed, and costs are climbing. The story still has strong sales growth, but those rising costs and shrinking margins are starting to poke holes in the original bull case....

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