Shares of VAT Group AG moved higher on Wednesday after UBS increased its price target for the Swiss vacuum valve manufacturer to 745 Swiss francs from 650 Swiss francs, while retaining a Buy rating. The bank also raised its 2027 and 2028 earnings-per-share forecasts by 7% and 16%, respectively, and flagged significant upside risk to consensus earnings for the next several years.
Analysts led by Joern Iffert said UBS sees upside risk to consensus earnings estimates of 10-20% over the coming years. In early European trading, VAT Group shares rose 1.8%.
The revision of UBS's estimates is driven by a markedly more optimistic view of wafer fab equipment capital expenditure across the semiconductor industry. UBS now expects WFE capex to grow 27% year-on-year to $147 billion in 2026, accelerate by 35% to $198 billion in 2027, and rise a further 25% to $247 billion in 2028. These projections are materially higher than the bank's prior forecasts.
WFE describes the machines and tools used by chipmakers to fabricate semiconductors on silicon wafers. UBS wrote that the market is at the start of a strong multi-year WFE capex growth cycle and noted that order intake in the semiconductor vacuum supply chain only began to pick up in late 2025.
The bank also pointed to industry capital intensity being around 10%, which it described as slightly below the historical average. UBS interprets that level as consistent with chip equipment spending tracking genuine end-demand rather than temporary inventory moves.
VAT is positioned as a direct beneficiary of the buildout of new semiconductor fabrication plants and the rise in AI-driven chip demand, in part because it commands roughly a 50% global market share in vacuum valves. UBS emphasized that VAT's market share is eight to ten times larger than that of its nearest competitor.
UBS left its 2026 organic sales growth forecast for VAT unchanged at 29% year-on-year. The bank cautioned that the semiconductor vacuum supply chain could become stretched, meaning some suppliers may not be able to meet delivery schedules and that this could translate into quarterly sales growth volatility for VAT.
VAT is often the sole source for certain customers and is currently working to ramp capacity to meet demand, UBS added.
For 2027 and 2028, UBS's updated forecasts call for organic sales of 1.85 billion francs and 2.29 billion francs, respectively. Those figures sit well above consensus estimates, which UBS noted at 1.62 billion francs for 2027 and 1.83 billion francs for 2028.
Sector implications and market context
- Semiconductor equipment - Higher WFE capex forecasts point to stronger demand for chipmaking tools and components.
- Industrial supply chains - Potential capacity constraints in the vacuum supply chain could create delivery risks and short-term revenue volatility for suppliers.
- Equities/REITs and capital markets - Upward analyst revisions and a higher price target have translated into immediate share-price gains for VAT Group.
Analyst outlook
UBS's adjustments reflect both a higher top-line trajectory for VAT and the bank's view that consensus earnings may be meaningfully conservative. The combination of a large market share in vacuum valves and the start of a multi-year WFE spending cycle underpins UBS's more bullish stance.