Formfactor (FORM) AI Stock Analysis

• Market Cap: $2.69B
• Dividend Yield: N/A
• Average Volume (3M): 611.04K
• Price to Earnings (P/E): 48.6
• Beta (1Y): 2.05
• Revenue Growth: 15.33%
• EPS Growth: -47.04%
• Country: US
• Employees: 2,238
• Sector: Technology
• Sector Strength: 84
• Industry: Semiconductors
• EPS (TTM): 0.23
• Shares Outstanding: 77,076,645
• 10 Day Avg. Volume: 683,881
• 30 Day Avg. Volume: 611,041
• PEG Ratio: -0.85
• Price to Book (P/B): 2.13
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.92
• Enterprise Value/Market Cap: 0.71
• Enterprise Value/Revenue: 0.64
• Enterprise Value/Gross Profit: 6.14
• Enterprise Value/Ebitda: 3.66
• 1Y Price Target: $38.00
• Price Target Upside: 13.06% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 66 Neutral
• Price Target: $34.00 ▲(1.16%Upside)

FormFactor's overall score is driven by its solid financial position and positive short-term technical indicators. However, valuation concerns and mixed earnings call sentiment, impacted by geopolitical challenges and profitability issues, weigh down the score.

Positive Factors

Financial Performance

FormFactor reported a beat-and-raise quarter and delivered a rare V-shaped recovery after a disappointing print.

Market Demand

Growing exposure to a 2nd HBM customer is a tailwind, though majority of demand remain centered with the company's biggest customer.

Strategic Partnerships

FormFactor remains focused on, and is making inroads, strengthening its market leadership at strategic customers like AMD and NVIDIA.

Negative Factors

Customer Relations

The company faces challenges with its former top customer, INTC, which is tracking below norms with uncertain recovery timing.

Market Challenges

US BIS shipment restrictions have significantly impacted China's demand for probe cards, contributing to a year-over-year growth headwind.

Revenue Guidance

Mar '25 Q guidance miss with Rev/EPS of $170M/$0.19 below the Street's $193M/$0.33 view.

Formfactor Business Overview & Revenue Model

Company Description

FormFactor, Inc. is a leading provider of essential test and measurement technologies for the semiconductor industry. The company is headquartered in Livermore, California, and operates in sectors including semiconductor manufacturing and electronic design. FormFactor specializes in designing and manufacturing advanced wafer probe cards, analytical probes, and thermal sub-systems. These products are critical for wafer testing and help semiconductor manufacturers ensure the quality and performance of their products across various applications, from electronics to telecommunications.

How the Company Makes Money

FormFactor generates revenue primarily through the sale of its semiconductor testing products, including probe cards and analytical probes. The company's key revenue streams include sales to semiconductor manufacturers and integrated device manufacturers who require precise testing solutions to improve yield and performance. FormFactor also capitalizes on its technological expertise and innovation to maintain long-term partnerships with leading semiconductor companies. Additionally, the company may receive income from service contracts related to the maintenance and support of its testing products. The growing demand for advanced semiconductor devices in various industries, such as consumer electronics and automotive, significantly contributes to FormFactor's earnings.

Formfactor Financial Statement Overview

Summary

FormFactor demonstrates a solid financial position with consistent revenue and profitability, but faces pressure on margins and cash flows. The balance sheet is strong with low debt levels, yet cash flow management and operational efficiency need improvement for sustained growth.

Income Statement

Formfactor shows a stable Gross Profit Margin of approximately 40% over the periods, indicating efficiency in cost management. However, the Net Profit Margin has seen a decline from the previous year, primarily due to a decrease in EBIT, which has impacted profitability. The Revenue Growth Rate is modest but positive, reflecting steady growth in sales, though the latest TTM shows a slight dip. Margins such as EBIT and EBITDA have decreased in the latest TTM, signaling potential challenges in operational efficiency.

Balance Sheet

The company maintains a strong balance sheet with a low Debt-to-Equity Ratio, highlighting financial stability and low leverage. ROE has decreased slightly, aligning with the dip in net income, yet remains healthy. The Equity Ratio indicates a robust capital structure with a high proportion of equity funding the assets, reducing financial risk.

Cash Flow

Operating Cash Flow remains positive, although it has decreased compared to the previous year, which could constrain liquidity if the trend continues. Free Cash Flow has decreased in the TTM period, reflecting lower operational efficiency and capital expenditure management. The ratio of Operating Cash Flow to Net Income suggests reasonable cash generation from earnings, albeit with room for improvement.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
766.23M	763.60M	663.10M	747.94M	769.67M	693.62M
	Gross Profit
309.71M	307.92M	258.58M	303.43M	322.77M	287.92M
	EBIT
46.75M	64.78M	82.76M	54.91M	98.04M	83.79M
	EBITDA
115.97M	112.73M	127.14M	104.64M	150.79M	140.68M
	Net Income Common Stockholders
54.23M	69.61M	82.39M	50.74M	83.92M	78.52M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
298.99M	360.02M	328.32M	238.13M	276.06M	255.03M
	Total Assets
1.16B	1.15B	1.11B	1.01B	1.02B	963.22M
	Total Debt
37.48M	39.23M	48.15M	50.37M	63.27M	69.19M
	Net Debt
-92.41M	-151.50M	-129.67M	-55.75M	-87.73M	-118.03M
	Total Liabilities
190.29M	198.45M	197.99M	199.94M	204.74M	219.13M
	Stockholders Equity
965.87M	947.77M	908.80M	808.28M	815.78M	744.08M
Cash Flow		Free Cash Flow
64.48M	79.10M	8.57M	66.53M	72.87M	113.39M
	Operating Cash Flow
108.06M	117.53M	64.60M	131.79M	139.36M	169.26M
	Investing Cash Flow
-114.32M	-33.48M	29.05M	-75.70M	-124.74M	-98.92M
	Financing Cash Flow
-53.08M	-64.61M	-22.71M	-95.93M	-47.20M	-30.93M

Formfactor Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 33.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FORM, the sentiment is Neutral. The current price of 33.61 is above the 20-day moving average (MA) of 32.37, above the 50-day MA of 30.08, and below the 200-day MA of 37.71, indicating a neutral trend. The MACD of 1.08 indicates Negative momentum. The RSI at 56.47 is Neutral, neither overbought nor oversold. The STOCH value of 61.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for FORM.

Formfactor Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAMT	78 Outperform	$3.44B	28.51	24.82%	1.79%	32.63%	46.16%
VECO	74 Outperform	$1.27B	19.33	8.68%	―	3.30%	―
SIMO	70 Outperform	$2.35B	24.99	12.33%	2.91%	10.78%	58.82%
FORM	66 Neutral	$2.69B	48.58	5.74%	―	15.33%	-47.04%
Sector *	62 Neutral	$11.96B	10.09	-7.50%	3.10%	7.33%	-8.11%
KLIC	58 Neutral	$1.87B	97.79	2.29%	2.32%	-6.17%	―
AMBA	57 Neutral	$2.22B	―	-18.35%	―	44.54%	41.55%

Formfactor Corporate Events

FormFactor Stockholders Approve Key Proposals at Annual Meeting

FormFactor, Inc. held its 2025 Annual Meeting of Stockholders on May 16, 2025, where several key proposals were approved. Notably, the stockholders approved an amendment to the 2012 Equity Incentive Plan, increasing the number of shares of common stock reserved for issuance by 2,200,000 shares. Additionally, all director nominees were elected, the executive compensation was approved on an advisory basis, and KPMG LLP was ratified as the Company’s independent registered public accounting firm for fiscal year 2025.

The most recent analyst rating on (FORM) stock is a Buy with a $51.00 price target. To see the full list of analyst forecasts on Formfactor stock, see the FORM Stock Forecast page.