Updated Aug 7 at 6:03pm ET.
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Oppenheimer raised its rating to Outperform, which is their way of saying they expect the stock to do better than the broader market. They set a price target of $180, suggesting the stock has room to rise from its current level of about $146.
This move comes right after the company reported better-than-expected results. Analysts are becoming more confident that the slump in chip manufacturing is ending. Because the company sells the filters and chemicals used to make chips, it earns more whenever factories run at higher volumes.
Source: Oppenheimer
UBS increased its price target from $205 to $215 following the company's latest earnings report. This target is well above the current share price and reflects a belief that the company will benefit as chipmakers invest more in new equipment and production capacity.
Source: UBS
The company reported second-quarter sales of $883 million, which was higher than the $840 million analysts expected. It earned $0.93 per share, beating the $0.82 estimate. Management noted that demand is improving as customers invest more in their factories and move toward more advanced chip designs.
This is a positive sign for the business because it acts as a supplier to the entire industry. When chipmakers like Intel or TSMC increase production or build new facilities, they need more of the high-purity filters and specialty chemicals this company provides. The double-digit growth in both its recurring sales and its equipment-related business suggests the industry downturn is fading.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
The company announced that Bertrand Loy retired as Executive Chair at the end of July. James Gentilcore, who was already on the board, has stepped into the role. Additionally, the company appointed Robert Bruggeworth, the CEO of chipmaker Qorvo, as a new director.
While leadership changes can sometimes create uncertainty, this looks like an orderly transition. Bringing in a director who currently runs a major semiconductor company adds fresh industry experience to the board as the firm navigates the current recovery in chip demand.
Source: 8-K filing
The board of directors approved a quarterly dividend of $0.10 per share. It will be paid on August 19 to anyone who owned the stock as of July 29. This is a routine payment and matches what the company has paid in recent quarters.
Source: Business Wire
Analysts recently updated their outlooks following the company's latest earnings report, with several firms raising their price targets. Most analysts, 18 of 27, rate the stock a buy, and the average target of $169 suggests an 11% upside.
The company has beaten profit expectations for six straight quarters. This suggests management is conservative with its forecasts and the business is recovering faster than analysts expected.
| Expectation | |
|---|---|
| EPS | $1.00 |
| Revenue | $922M |
