PDF Solutions

PDFS

Software - Application · Technology

Price

$51.14

-0.79 (-1.52%)

Market Cap

$2.14B

Exchange

NASDAQ

Winston Score

Winston is curious

A decent business — some strong pillars, some weaker.

Share count rising — dilution

+5.9% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 37.1M (2021) → 39.3M (2025)

PDF Solutions, Inc. provides proprietary software and physical intellectual property products for integrated circuit designs, electrical measurement hardware tools, proven methodologies, and professional services in the United States, China, Japan, Taiwan, and internationally. The company offers Exensio software products, such as Manufacturing Analytics that stores collected data in a common environment with a consistent view for enabling product engineers to identify and analyze production yiel

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+25.9% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

+254.6% YoY

YoY Growth Rate

EPS growth accelerating

R&D Spend

$64M/ year

↑ Rising (+15% vs prior year)

29.3% of revenue

2.0x the sector average (15%)

Investing heavily in future products and technology

Insider Activity

21.0%ownership

↑ Rising

Insiders increasing their stake — aligned with shareholders

Cash Runway

~11 months

$31M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Short runway — potential dilution ahead through share issuance

Revenue accelerating

PDF Solutions grew revenue 26% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

70.1%

Premium pricing power — 70.1% gross margin

Operating Margin

10.5%

Modest — 10.5% operating margin

ROCE

2.2%

Weak — 2.2% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+24.4%

Fast-growing sales (24.4% YoY)

EPS YoY

+63.7%

Earnings growing fast (63.7% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency

2/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

238%

Turns 238% of profit into real cash

FCF Margin

-7.8%

Burning cash (-7.8%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity

0.03

Conservative — low debt load (0.03)

Interest Cover

6.15x

Adequate interest coverage (6.2x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

282.7x

Expensive — P/E 282.7

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+226.0

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (282.7 → 56.7)

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Dividends

Not applicable for this business.

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