TTM Technologies Rides Both Defense Supercycle And Datacenter Gold Rush
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Danil SeredaInvesting Group LeaderFollow5ShareSavePlay(13min)CommentsSummaryTTM Technologies has surged over 200% in a year as it pivots from commodity PCBs to a mission‑critical defense and AI infrastructure electronics provider. TTMI consistently beats guidance, posting 22% YoY revenue growth in Q3 and robust cash flow, with net debt/EBITDA at 1.0x. Roughly 80% of sales now come from aerospace/defense and AI‑linked datacenter/networking, with a 1.15 book‑to‑bill signaling sustained demand and backlog growth ahead. New capacity in Penang, Syracuse, and Eau Claire should support long‑term AI and defense demand, creating near‑term margin drag but substantial earnings leverage once volumes ramp. Even after its rally, TTMI trades cheaply on its prospective PEG ratio. I see scope for multiple expansion, and EPS beats driving 40%+ upside over the next year. TTMI is a "Buy" Getty Images Even among tech stocks these days, we rarely see ones rising by over 200% in a single year. One of such stocks popped up on my screen a few weeks ago, it was TTM Technologies, Inc. (This article was written byDanil Sereda14.08K FollowersFollowDaniel Sereda is chief investment analyst at a family office whose investments span continents and diverse asset classes. This requires him to navigate through a plethora of information on a daily basis. His expertise is in filtering this wealth of data to extract the most critical ideas. He runs the investing group Beyond the Wall Investing in which he provides access to the same information that institutional market participants prioritize in their analysis. Learn more.Analyst’s Disclosure:I/we have a beneficial long position in the shares of TTMI either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Quick InsightsWhat are the key growth drivers for TTMI's bullish outlook?TTMI's growth is fueled by accelerating demand in aerospace, defense, and AI-linked data center markets, with a book-to-bill ratio of 1.15 and expanding margins.How does TTMI's valuation compare to sector peers after its rally?TTMI trades at a forward PEG ratio of 0.66x, 33% below sector median, with potential 42-43% upside if PEG normalizes to 1.2x by next year.What are the primary risks to TTMI achieving its growth targets?Execution risks stem from ramping three new factories; delays or volume shortfalls could pressure margins and trigger downside of ~11.5% if FY2026 EPS disappoints.Recommended For You