Research HubSoftware & Cloud ServicesCohu, Inc. (COHU)

Coverage:KVYO DDOG CRWD NOW SNOW PLTR ADBE CRM PANW NET SHOP MDB

SEC 10-K / 10-Q Equity ResearchSoftware & Cloud ServicesTicker: COHU

Cohu, Inc. (COHU) DCF Valuation & Fundamental Primer

Cohu, Inc. (COHU) currently trades at $25.10 with an enterprise value of $1.12B. Our proprietary institutional model rates Cohu, Inc. at 88/100 (Grade: A+ · Elite SaaS Compounder). The current market price prices in an implied 5-year revenue CAGR of 17.8% vs. historical growth of 19.1% (Fairly Priced to Fundamentals).

GDA Quality Score

A+88/100

Elite SaaS Compounder

Share Price / DCF Base

$25.10 / $26.30

Enterprise Value

$1.07B

TTM Revenue

$189.0M (+19.1%)

Gross Margin

76.6%

Rule of 40 Score

41.3%

EV / TTM Revenue

5.6×

Structural Moat: Enterprise Software & Cloud Services Switching Costs & Recurring Workflow Integration

Key Growth Catalyst: AI workflow automation, multi-module expansion across enterprise cohorts, and operating margin leverage at Cohu, Inc..

Institutional fundamental teardown of Cohu, Inc. (COHU) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.

Seed COHU in Interactive 3-Statement Model

Section 1 · Intrinsic Valuation Engine

Cohu, Inc. (COHU) 3-Scenario DCF Valuation Range

WACC: 10.0% · Terminal Growth: 2.5% · Diluted Shares: 46.7M

bear Case DCFSensitivity

$12.83

Implied Equity Value:$599.1M

vs Current ($25.10):-48.9%

base Case DCFPrimary Benchmark

$26.30

Implied Equity Value:$1.23B

vs Current ($25.10):+4.8%

bull Case DCFSensitivity

$44.77

Implied Equity Value:$2.09B

vs Current ($25.10):+78.4%

Interactive What-If DCF SandboxSim Rule of 40: 41.3%

Stress-test COHU's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.

Seed Custom Drivers in /model

1-Click Regimes:

5Y Revenue CAGR19.1%

2%Hist: 19.1%50%

Target FCF Margin22.2%

5%Base: 22.2%45%

WACC Discount Rate10.0%

6.5%Base: 10%14.5%

Terminal Growth (g)2.5%

1.0%Implies 13.7× Y5 FCF4.0%

Accounting Lens:

Simulated Implied Price$26.30

Spread vs Market+4.8%

Simulated EV$1.12B

Effective FCF Margin22.2%

Simulated 5-Year Cash Flow Trajectory (Unlevered FCF vs. Discounted PV)Cumulative 5Y PV: $268.0M

Year 1$225.1M

FCF:$50.0M

PV:$45.4M

Year 2$268.1M

FCF:$59.5M

PV:$49.2M

Year 3$319.3M

FCF:$70.9M

PV:$53.3M

Year 4$380.3M

FCF:$84.4M

PV:$57.7M

Year 5$453.0M

FCF:$100.6M

PV:$62.4M

Enterprise Value Composition Bridge$1.12B

Split between 5-Year Explicit Cash Flows and Discounted Terminal Value

5Y Explicit PV: $268.0M (23.9%)Terminal PV: $853.3M (76.1%)

(+) Balance Sheet Cash & Equivalents+$106.4M

(−) Total Debt Obligations−$0

(=) Implied Equity Value (46.7M shs)$1.23B

2D Institutional Valuation Sensitivity Heatmap

Implied share price & upside/downside spread across 25 valuation states (Current Price: $25.10).

WACC \ Terminal	1.5%	2.0%	2.5%	3.0%	3.5%
8.5%	$29.04 +16%	$30.75 +23%	$32.74 +30%	$35.10 +40%	$37.92 +51%
9.3%	$26.27 +5%	$27.61 +10%	$29.16 +16%	$30.95 +23%	$33.05 +32%
10.0%	$23.99 -4%	$25.07 -0%	$26.30 +5%	$27.70 +10%	$29.31 +17%
10.8%	$22.08 -12%	$22.97 -9%	$23.96 -5%	$25.08 -0%	$26.35 +5%
11.5%	$20.46 -18%	$21.20 -16%	$22.01 -12%	$22.92 -9%	$23.95 -5%

Section 2 · Fundamental Underwriting

Institutional Software Quality Scorecard (88/100 · Grade A+)

Elite SaaS Compounder

Exceptional unit economics, disciplined equity dilution, and fortress balance sheet.

Cash Conversion25 / 25

Actual: 5550% of EBITTarget: Target: ≥100%

Elite deferred revenue float; FCF exceeds operating income by >20%

Dilution Friction16 / 25

Actual: 13.0% of RevTarget: Target: ≤8%

Standard software SBC dilution; modest equity transfer to employees

Unit Economics25 / 25

Actual: 77% GM / R40: 41%Target: Target: ≥75% GM / ≥40% R40

Elite Tier-1 SaaS compounder with high gross margin and superior Rule of 40

Balance Sheet22 / 25

Actual: +$106.4M Net CashTarget: Target: Net Cash > 0

Positive net cash cushion; self-funding operations with zero insolvency risk

Core Investment Strengths & Moats

High-grade cash conversion: FCF is 5550% of EBIT driven by upfront annual collections
Top-quartile software unit economics: 76.6% gross margin and 41.3% Rule of 40 score
Net cash positive: $106.4M balance sheet buffer

Key Operational & Dilution Risks

Section 3 · Expectations Investing

Reverse-DCF Solver: What Growth is Priced Into COHU?

Fairly Priced to Fundamentals

Market implies 17.8% annual revenue growth over next 5 years (29.7% dilution-adjusted), in line with company run-rate.

Implied 5-Year Revenue CAGR

17.8%

Required to justify $1.07B EV

Historical Run-Rate CAGR

19.1%

Audited multi-year top-line trajectory

Growth Hurdle Spread

-1.3%

Implied hurdle minus historical growth

Implied FCF Margin @ Hist. Growth

21.1%

Steady-state FCF margin needed at current CAGR

Institutional Dilution-Adjusted Hurdle Lens

Headline Reverse-DCF ignores Stock-Based Compensation (13.0% of revenue) and annual share dilution (1.8%/yr). Accounting for both requires 29.7% 5-year revenue CAGR to justify $25.10/sh on a true per-share economic cash flow basis.

True Economic Hurdle29.7%

SBC & Dilution Hurdle Tax+11.9% / yr

Section 4 · 5-Year Forecast Schedule

Cohu, Inc. (COHU) 5-Year Fundamental Forecast

Customize in Live Engine

Statement Line Item	TTM Audited Base	TTM	Y1	Y2	Y3	Y4	Y5
Revenue	$189.0M	$189.0M	$225.1M	$268.1M	$319.3M	$380.3M	$453.0M
Gross Profit	$144.8M	$144.8M	$172.4M	$205.4M	$244.6M	$291.3M	$347.0M
Operating Income (EBIT)	$756.1K	$756.1K	$900.5K	$1.1M	$1.3M	$1.5M	$1.8M
Stock-Based Compensation (SBC)	$24.6M	$24.6M	$29.3M	$34.9M	$41.5M	$49.4M	$58.9M
Unlevered Free Cash Flow (FCF)	$42.0M	$42.0M	$50.0M	$59.5M	$70.9M	$84.4M	$100.6M
SBC-Adjusted True Cash Flow	$17.4M	$17.4M	$20.7M	$24.7M	$29.4M	$35.0M	$41.7M

Section 5 · Relative Valuation Multiples & Regression

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Click any peer node or ticker to open its dedicated equity research report

Rule of 40 vs. EV / Revenue Multiple Regression

OLS Fit: EV/Rev = -26.9 + 0.76 × (Rule of 40) · R² = 81%

Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.

COHU Actual vs. Reg. Multiple5.6× vs 4.3× fair

Reg.-Implied Share Price$19.88 (+29.7% Premium)

COHUCohu, Inc.·Rule of 40: 41.3%·Actual EV/Rev: 5.6×·Regression Fair Multiple: 4.3×

+29.7% Above Trendline (Premium)Open COHU Report

Company	Ticker	Market Cap	TTM Revenue	Gross Margin	FCF Margin	Rule of 40	SBC % Rev	EV / Rev
Cohu, Inc.	COHU	$1.17B	$189.0M	76.6%	22.2%	41.3%	13.0%	5.6×
ServiceNow	NOW	$152.61B	$10.98B	79.2%	31.1%	54.2%	15.9%	13.9×
Workday, Inc.	WDAY	$50.35B	$8.00B	75.0%	27.4%	43.9%	19.0%	6.4×
Salesforce	CRM	$217.10B	$37.90B	77.2%	32.8%	42.8%	8.4%	5.8×
Datadog	DDOG	$46.05B	$2.68B	80.8%	31.1%	57.7%	21.3%	17.4×
Snowflake Inc.	SNOW	$71.79B	$3.63B	66.5%	25.2%	57.7%	40.8%	20.0×
Hubspot	HUBS	$19.89B	$2.63B	85.0%	21.3%	52.7%	19.2%	7.7×
Peer Cohort Median Benchmark (N=6)				78.2%	29.2%	53.5%	19.1%	10.8×

Section 6 · Downside Protection & Multiple Sensitivity

EV / Revenue Multiple Compression Stress Test

Multiple Scenario	EV / Revenue	Implied Enterprise Value	Implied Equity Value	Implied Share Price	Delta vs Current
Current Multiple	5.6×	$1.07B	$1.17B	$25.10	0.0%
-20% Multiple Compression	4.5×	$852.4M	$958.8M	$20.54	-20.0%
-35% Multiple Compression	3.7×	$692.6M	$799.0M	$17.11	-35.0%
Software Baseline Floor (5.0× EV/Rev)	5.0×	$945.1M	$1.05B	$22.52	-11.3%

Section 7 · Investor Diligence FAQ

Frequently Asked Questions: Cohu, Inc. (COHU) Valuation

What is Cohu, Inc. (COHU)'s intrinsic DCF valuation and implied share price?

Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Cohu, Inc. (COHU) has a Base Case implied value of $26.30 per share (with a Bear Case of $12.83 and a Bull Case of $44.77), compared to its current price of $25.10. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.

What is Cohu, Inc. (COHU)'s Rule of 40 score and Free Cash Flow margin?

Cohu, Inc. achieves a Rule of 40 score of 41.3%, combining a 19.1% revenue growth run-rate with a 22.2% TTM free cash flow margin on $189.0M in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.

What revenue growth rate is priced into COHU stock according to Reverse-DCF analysis?

At $25.10 per share (Enterprise Value of $1.07B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 17.8%, compared to Cohu, Inc.'s historical CAGR of 19.1%. Overall market expectations are rated as "Fairly Priced to Fundamentals".

How does Cohu, Inc. compare to Software & Cloud Services software peers?

Cohu, Inc. (COHU) earns an institutional Software Quality Score of 88/100 (Grade A+ — Elite SaaS Compounder). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.

How does Stock-Based Compensation (SBC) impact Cohu, Inc. (COHU)'s valuation?

Cohu, Inc. recorded $24.6M in TTM stock-based compensation (13.0% of revenue). When treating SBC as a cash-equivalent compensation expense, Cohu, Inc.'s SBC-adjusted free cash flow yield is 1.5%, scoring 16/25 on our Shareholder Dilution Friction pillar.

Cohu, Inc. (COHU) DCF Valuation & Fundamental Primer

WACC \ Terminal

1.5%

2.0%

2.5%

3.0%

3.5%

8.5%

$29.04

+16%

$30.75

+23%

$32.74

+30%

$35.10

+40%

$37.92

+51%

9.3%

$26.27

+5%

$27.61

+10%

$29.16

+16%

$30.95

+23%

$33.05

+32%

10.0%

$23.99

-4%

$25.07

-0%

$26.30

+5%

$27.70

+10%

$29.31

+17%

10.8%

$22.08

-12%

$22.97

-9%

$23.96

-5%

$25.08

-0%

$26.35

+5%

11.5%

$20.46

-18%

$21.20

-16%

$22.01

-12%

$22.92

-9%

$23.95

-5%

Statement Line Item

TTM Audited Base

TTM

Revenue

$189.0M

$225.1M

$268.1M

$319.3M

$380.3M

$453.0M

Gross Profit

$144.8M

$172.4M

$205.4M

$244.6M

$291.3M

$347.0M

Operating Income (EBIT)

$756.1K

$900.5K

$1.1M

$1.3M

$1.5M

$1.8M

Stock-Based Compensation (SBC)

$24.6M

$29.3M

$34.9M

$41.5M

$49.4M

$58.9M

Unlevered Free Cash Flow (FCF)

$42.0M

$50.0M

$59.5M

$70.9M

$84.4M

$100.6M

SBC-Adjusted True Cash Flow

$17.4M

$20.7M

$24.7M

$29.4M

$35.0M

$41.7M

Company

Ticker

Market Cap

TTM Revenue

Gross Margin

FCF Margin

Rule of 40

SBC % Rev

EV / Rev

Cohu, Inc.

COHU

$1.17B

$189.0M

76.6%

22.2%

41.3%

13.0%

5.6×

ServiceNow

NOW

$152.61B

$10.98B

79.2%

31.1%

54.2%

15.9%

13.9×

Workday, Inc.

WDAY

$50.35B

$8.00B

75.0%

27.4%

43.9%

19.0%

6.4×

Salesforce

CRM

$217.10B

$37.90B

77.2%

32.8%

42.8%

8.4%

5.8×

Datadog

DDOG

$46.05B

$2.68B

80.8%

31.1%

57.7%

21.3%

17.4×

Snowflake Inc.

SNOW

$71.79B

$3.63B

66.5%

25.2%

57.7%

40.8%

20.0×

Hubspot

HUBS

$19.89B

$2.63B

85.0%

21.3%

52.7%

19.2%

7.7×

Peer Cohort Median Benchmark (N=6)

78.2%

29.2%

53.5%

19.1%

10.8×

Multiple Scenario

EV / Revenue

Implied Enterprise Value

Implied Equity Value

Implied Share Price

Delta vs Current

Current Multiple

5.6×

$1.07B

$1.17B

$25.10

0.0%

-20% Multiple Compression

4.5×

$852.4M

$958.8M

$20.54

-20.0%

-35% Multiple Compression

3.7×

$692.6M

$799.0M

$17.11

-35.0%

Software Baseline Floor (5.0× EV/Rev)

5.0×

$945.1M

$1.05B

$22.52

-11.3%

Cohu, Inc. (COHU) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (88/100 · Grade A+)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into COHU?

Cohu, Inc. (COHU) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Cohu, Inc. (COHU) Valuation

What is Cohu, Inc. (COHU)'s intrinsic DCF valuation and implied share price?

What is Cohu, Inc. (COHU)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into COHU stock according to Reverse-DCF analysis?

How does Cohu, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Cohu, Inc. (COHU)'s valuation?

Related Software & Cloud Services Equity Research Reports

Cohu, Inc. (COHU) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (88/100 · Grade A+)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into COHU?

Cohu, Inc. (COHU) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Cohu, Inc. (COHU) Valuation

What is Cohu, Inc. (COHU)'s intrinsic DCF valuation and implied share price?

What is Cohu, Inc. (COHU)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into COHU stock according to Reverse-DCF analysis?

How does Cohu, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Cohu, Inc. (COHU)'s valuation?

Related Software & Cloud Services Equity Research Reports