Investors in semiconductor manufacturing equipment maker Photronics (PLAB 1.87%), which makes the "photomasks" used to transfer circuit patterns onto semiconductor wafers, are putting on a happy face on Wednesday. Shares of the chip equipment maker surged 15.8% higher through 12:10 p.m. ET after beating earnings.

And why are they surging? Because instead of the $244 million revenue and $0.53-per-share (pro forma) profit that Wall Street had predicted for Photronics' fiscal Q4 2023 report, Photronics just reported $227.5 million in sales, and $0.60 in earnings (also pro forma).

Photronics sales and earnings

And CEO Frank Lee pointed out that Q4 marked the wrapping up of Photronics' sixth straight year of reporting record sales growth.

Sales for both the quarter and the year grew 8% over fiscal-2022 numbers. And despite some weakness in gross profit margins, Photronics' success in cutting expenses enabled the company to mostly maintain its reputation for strong operating profit margins -- down 60 basis points to 28.5% for the quarter, but up 270 basis points to 28.4% for the year.

Arguably best of all, while it took only $0.60 in pro forma earnings to beat Wall Street estimates, when calculated according to generally accepted accounting principles (GAAP), Photronics' earnings for the quarter were actually $0.72 (up 20% year over year). For the full year, GAAP profits came in at $2.03 per share -- up 5%.

Is Photronics stock a buy?

If you think all the above sounds pretty great, you might want to sit down for this next part. Switching to guidance for the new fiscal year, Photronics announced that in its upcoming fiscal Q1 2024, it's expecting to report sales between $217 million and $225 million.

Granted, at the midpoint, that works out to only about 5% revenue growth. But on the bottom line, Photronics says pro forma profits could range from $0.45 to $0.53 per share. At the midpoint (i.e., $0.49 per share), that works out to more than double last year's pro forma profit of $0.23 per share. And if GAAP earnings are anywhere close to the pro forma number, Photronics could double last year's actual GAAP profit as well -- more than 100% quarterly earnings growth.

Suffice it to say that with the stock selling for barely 11 times earnings today, scoring an earnings growth rate of 100% would make Photronics stock a pretty obvious buy.