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FormFactor (FORM) Valuation Check After Strong 3 Month Share Price Momentum

Simply Wall St · 01/05 04:42

FormFactor stock: recent performance snapshot

FormFactor (FORM) has drawn investor interest after a stretch of solid share price performance, with the stock showing gains over the past week, month and past 3 months compared with recent levels.

At a last close of US$59.19, the company’s recent total return figures, including about 3% over the past week and around 52% in the past 3 months, are prompting closer scrutiny of its current valuation and fundamentals.

See our latest analysis for FormFactor.

FormFactor’s recent 6.11% 1 day share price return and 52.43% 3 month share price return sit alongside a 28.34% 1 year total shareholder return and 142.48% 3 year total shareholder return, suggesting momentum has been building over time.

If FormFactor’s move has you looking beyond a single name, it could be a good time to broaden your watchlist and check out high growth tech and AI stocks as potential next ideas.

With the shares close to recent analyst targets and the stock trading after strong recent returns, the key question now is whether FormFactor still offers value or if the market is already pricing in future growth.

Most Popular Narrative: 4.1% Overvalued

With FormFactor last closing at US$59.19 against a narrative fair value of US$56.88, the current share price sits slightly above that framework, which hinges on specific growth, margin and valuation assumptions that go beyond recent share price strength.

• Analysts expect earnings to reach $97.0 million (and earnings per share of $0.78) by about September 2028, up from $43.9 million today. The analysts are largely in agreement about this estimate.

Read the complete narrative.

Curious how earnings could more than double while the assumed profit margin also steps up and the P/E multiple trends lower from today’s level? The full narrative walks through the revenue path, margin reset and valuation multiple that together support the fair value, and shows how small shifts in any of those inputs could change the outcome.

Result: Fair Value of $56.88 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the narrative still leans on improving margins and steady DRAM and HBM demand, and setbacks on either front could quickly challenge today’s pricing.

Find out about the key risks to this FormFactor narrative.

Build Your Own FormFactor Narrative

If you interpret the numbers differently or prefer to test your own assumptions, you can create a custom view in just a few minutes by starting with Do it your way.

A great starting point for your FormFactor research is our analysis highlighting 1 key reward and 1 important warning sign that could impact your investment decision.

Ready for more stock ideas?

If FormFactor is on your radar, do not stop there, the Simply Wall St screener can quickly surface other opportunities that might fit your style and goals.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.