Follow Fabrinet to never miss an important update.
Barclays raised its price target for the stock to $739 from $702 while keeping an overweight rating, which is a recommendation that the stock should make up a larger part of a portfolio than its peers. This move follows a quarter where the company exceeded its own financial goals.
Analysts at the firm are signaling that the company's role in building AI infrastructure remains a powerful driver for growth. Even with the stock's recent drop, this target suggests the firm sees significant room for the price to rise as the build-out of high-speed data centers continues.
Source: Barclays
The company reported quarterly earnings of $4.10 per share, which was higher than the $3.81 analysts expected. Revenue for the quarter reached 1.32 billion dollars, also topping expectations. For the full fiscal year, total sales grew 36 percent to 4.6 billion dollars as demand for AI data center components accelerated.
This performance shows the company is successfully capturing the wave of spending on AI infrastructure. As the primary builder of the optical connections that link AI chips together, the company is seeing its specialized manufacturing expertise pay off in the form of record sales and faster profit growth. Management noted they remain optimistic about the durability of this growth trend heading into next year.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
The company's Thailand-based subsidiary entered into a new agreement to borrow about 75 million dollars and expanded an existing credit line. These funds, along with cash the company already has, are earmarked for capital expenditures, which is money spent on physical assets like buildings and manufacturing equipment.
The move ensures the company has the cash ready to expand its production capacity. This is a standard step for a manufacturer that needs to keep its plants updated and ready to build the high-speed optical components required by its AI customers.
Source: 8-K filing
Management consistently sets a bar they can clear, beating their own targets for eight straight quarters as AI demand outpaces even their own optimistic forecasts.
| Expectation | |
|---|---|
| EPS | $4.19 |
| Revenue | $1.40B |