FormFactor (NASDAQ:FORM) Shares Gap Down – Time to Sell?

FormFactor, Inc. (NASDAQ:FORM)’s stock price gapped down before the market opened on Thursday. The stock had previously closed at $110.31, but opened at $101.80. FormFactor shares last traded at $100.5430, with a volume of 395,846 shares trading hands.

More FormFactor News

Here are the key news stories impacting FormFactor this week:

• Positive Sentiment: FormFactor reported third-quarter revenue of $280.5 million, up 38.4% year over year, while non-GAAP earnings reached $1.04 per share versus the $0.86 consensus estimate. Revenue, gross margin and earnings exceeded the high end of management’s outlook. FormFactor’s Q3 Earnings Beat Estimates, Revenues Increase Y/Y
• Positive Sentiment: Demand for probe cards, DRAM, photonics and foundry and logic applications is benefiting from AI-driven chip complexity. Growth in HBM4 testing and co-packaged optics could support longer-term expansion. FORM’s HBM and Foundry Testing Gain From AI Demand
• Positive Sentiment: Analysts at Zacks characterized FORM as more attractive than Cohu because of its stronger profitability, cash generation and established AI-related revenue, while Zacks also added the stock to its Rank #1 Strong Buy list. FORM vs. COHU: Which Semiconductor Testing Stock is a Better Buy?
• Neutral Sentiment: Fourth-quarter guidance calls for revenue of $275 million to $295 million and EPS of $0.86 to $1.04, both above consensus at the midpoint for EPS but implying only modest sequential revenue growth.
• Negative Sentiment: Investors are concerned that FormFactor’s existing manufacturing footprint is approaching capacity limits. Productivity gains may moderate until the Farmers Branch, Texas, facility ramps, while start-up inefficiencies are expected to pressure near-term profitability and gross margins. FormFactor Sinks Despite Record Quarter as Factory Nears Capacity Limits
• Negative Sentiment: Recent trading data showed substantial insider selling, with no reported insider purchases over the past six months, adding a cautious signal for investors.

Analyst Upgrades and Downgrades

A number of equities analysts have weighed in on FORM shares. TD Cowen upped their price objective on shares of FormFactor from $100.00 to $110.00 and gave the stock a “hold” rating in a research report on Thursday. Wall Street Zen upgraded FormFactor from a “buy” rating to a “strong-buy” rating in a research report on Saturday. Zacks Research lowered FormFactor from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 19th. Stifel Nicolaus set a $115.00 price target on FormFactor in a research report on Tuesday, October 13th. Finally, B. Riley Financial restated a “buy” rating on shares of FormFactor in a report on Monday, October 19th. Seven research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. According to MarketBeat, the company has a consensus rating of “Moderate Buy” and a consensus target price of $139.73.

FormFactor Stock Down 10.2%

The firm has a 50 day moving average price of $116.24 and a 200-day moving average price of $113.43. The company has a current ratio of 3.68, a quick ratio of 3.34 and a debt-to-equity ratio of 0.01. The firm has a market cap of $6.82 billion, a PE ratio of 39.97 and a beta of 1.18.

FormFactor (NASDAQ:FORM) last released its quarterly earnings data on Wednesday, October 28th. The semiconductor company reported $1.04 earnings per share for the quarter, topping analysts’ consensus estimates of $0.86 by $0.18. FormFactor had a net margin of 17.72% and a return on equity of 18.40%. The company had revenue of $280.55 million for the quarter, compared to analysts’ expectations of $270.52 million. During the same quarter last year, the company earned $0.33 earnings per share. The firm’s revenue for the quarter was up 38.4% on a year-over-year basis. Research analysts forecast that FormFactor, Inc. will post 2.76 EPS for the current fiscal year.

Insiders Place Their Bets

In related news, Director Kelley Steven-Waiss sold 2,100 shares of FormFactor stock in a transaction dated Thursday, September 3rd. The stock was sold at an average price of $96.10, for a total transaction of $201,810.00. Following the completion of the sale, the director owned 24,426 shares in the company, valued at approximately $2,347,338.60. This trade represents a 7.92% decrease in their position. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Mike Slessor sold 11,098 shares of the stock in a transaction dated Wednesday, October 14th. The stock was sold at an average price of $125.20, for a total value of $1,389,469.60. Following the transaction, the chief executive officer owned 455,596 shares in the company, valued at $57,040,619.20. This trade represents a 2.38% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 46,710 shares of company stock valued at $5,520,564. 0.79% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On FormFactor

Hedge funds and other institutional investors have recently modified their holdings of the company. Integrity Alliance LLC. bought a new stake in FormFactor during the 3rd quarter valued at $393,000. IPG Investment Advisors LLC bought a new position in shares of FormFactor in the third quarter worth $221,000. Greenleaf Trust increased its holdings in shares of FormFactor by 12.5% during the third quarter. Greenleaf Trust now owns 2,901 shares of the semiconductor company’s stock valued at $433,000 after purchasing an additional 323 shares during the period. Vise Technologies Inc. increased its holdings in shares of FormFactor by 43.3% during the third quarter. Vise Technologies Inc. now owns 5,642 shares of the semiconductor company’s stock valued at $842,000 after purchasing an additional 1,706 shares during the period. Finally, State of Wyoming raised its stake in shares of FormFactor by 163.1% during the third quarter. State of Wyoming now owns 4,533 shares of the semiconductor company’s stock valued at $677,000 after purchasing an additional 2,810 shares in the last quarter. 98.76% of the stock is owned by institutional investors and hedge funds.

About FormFactor

FormFactor, Inc is a semiconductor test and measurement company that designs and manufactures equipment and components used to evaluate integrated circuits during the wafer fabrication and production process. Its products help semiconductor manufacturers and suppliers measure electrical performance, identify defects and improve the development and manufacturing of advanced chips.

The company’s portfolio includes probe cards used for wafer-level testing, as well as probe stations, analytical systems and related accessories for semiconductor engineering and production applications.