Industries across the globe are increasingly adopting more sophisticated electronic systems, automation technologies, and high-precision manufacturing processes, creating a growing need for advanced measurement and testing solutions.
As products become more complex, particularly in areas such as artificial intelligence (AI), 5G communications, aerospace and defense, electric vehicles, and semiconductor manufacturing, companies require highly accurate, reliable, and automated instruments to ensure performance, efficiency, and regulatory compliance.
This trend has significantly increased demand for companies that design and manufacture electronic measurement and testing equipment. These solutions are critical for validating next-generation technologies, improving production yields, reducing downtime, and accelerating product development cycles.
Reflecting these favorable dynamics, the Zacks Electronics – Measuring Instruments Industry currently ranks within the top 4% of more than 240 Zacks industries.
Keeping this in mind, here are three stocks from this top-rated industry to consider, highlighting the sector’s strong earnings outlook, improving business conditions, and growing investor interest.
Advantest – ATEYY
Stock Price: $174
We’ll start with Advantest Corporation's ATEYY) stock, which sports a Zacks Rank #1 (Strong Buy) and has been soaring because AI-related semiconductor testing demand has exploded, and the company sits at the center of the boom.
This comes as Nvidia NVDA) and other AI chipmakers are buying far more test equipment, leading to record revenue for Advantest, upgraded earnings forecasts, and strong analyst ratings.
Notably, Advantest is one of the world's leading suppliers of automatic test equipment to the semiconductor industry and also produces electronic and optoelectronic instruments and systems.
With high double-digit top and bottom line growth in the forecast, Advantest’s annual sales are heading toward $10 billion with EPS expected to spike 36% this year and projected to increase another 18% in FY27 to $5.49.
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inTest – INTT
Stock Price: $15
inTest INTT) remains a relatively underfollowed small-cap stock with a market capitalization of around $200 million, but also boasts a Zacks Rank #1 (Strong Buy).
Now may be an ideal time to consider inTest as the company executes on its diversified growth plans, with more room for multiple expansion than many larger, mature instrumentation companies.
To that point, inTest stands out because it combines exposure to semiconductor testing with diversification into several faster-growing industrial markets. Unlike many small-cap electronics test equipment companies that depend almost entirely on semiconductor capital spending cycles, inTest has broadened its revenue base into the Auto/EV market, defense, industrial automation, medical and life sciences, and safety/security markets.
These are all areas benefiting from long-term trends like AI infrastructure growth, electrification, factory automation, and advanced electronics manufacturing. inTest’s expansion into defense and medical device equipment testing is particularly important because they are typically higher-margin and less cyclical areas of interest.
Reassuringly, earnings estimate revisions are nicely up for inTest in the last 60 days, with EPS expected at $0.45 this year compared to $0.06 a share in 2025. Plus, FY27 EPS is projected to increase another 13% to $0.51.
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Keysight Technologies – KEYS
Stock Price: $353
Sporting a Zacks Rank #2 (Buy), the price tag for Keysight Technologies KEYS) stock has gotten a bit lofty, but its accelerating growth trajectory has kept investors engaged as a provider of electronic design and test instrumentation systems.
Soaring over 100% in the last year, Keysight Technologies' stock is getting renewed attention because it sits at the intersection of several major long-term tech spending trends: AI infrastructure, semiconductor testing, next-generation networking (6G), defense electronics, and high-speed data centers.
Keysight provides the testing and validation equipment used to develop advanced chips, optical networking systems, and AI data-center infrastructure. As hyperscalers and semiconductor companies ramp up spending, Keysight benefits indirectly from the entire AI ecosystem.
Overall, the bullish thesis is that Keysight is becoming a “picks-and-shovels” supplier for AI and next-generation communications infrastructure, meaning it can benefit broadly from these high-growth markets without needing to pick the winning chipmaker or AI platform directly.
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Bottom Line
The growing adoption of advanced technologies, automation, and precision-driven manufacturing is creating strong long-term demand for electronic measurement and testing solutions.
With the Zacks Electronics – Measuring Instruments Industry ranked among the top-performing Zacks industries, companies operating in this space appear well-positioned to benefit from favorable growth trends, rising capital investment, and increasing demand across multiple high-tech markets.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
