Analyst Charles Shi from Needham maintained a Buy rating on AXT (AXTI – Research Report) and keeping the price target at $5.00.
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Charles Shi’s rating is based on a combination of factors, including AXT’s reported mixed results for the first quarter of 2025. While the company’s revenue aligned with expectations, the non-GAAP earnings per share fell short due to a negative gross margin caused by yield issues in its GaAs business and restrictions on InP sales. Despite these challenges, AXT anticipates an improvement in gross margins to approximately 10% in the second quarter as yield issues are addressed.
Furthermore, while there is uncertainty regarding the InP licensing process and potential tariff impacts in the second half of 2025, Charles Shi maintains a Buy rating. This decision reflects a belief in the company’s ability to navigate these challenges and improve its financial performance. The price target remains at $5, indicating confidence in AXT’s future growth prospects despite current headwinds.
In another report released today, Craig-Hallum also maintained a Buy rating on the stock with a $2.00 price target.
Based on the recent corporate insider activity of 12 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of AXTI in relation to earlier this year.