Formfactor (FORM)
NASDAQ:FORM
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Formfactor
(NASDAQ:FORM)
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Rating:73Outperform
Price Target:
$115.00
▲(11.48% Upside)
Action:ReiteratedDate:02/06/26
The score is driven primarily by solid financial stability (very low leverage) and strong technical momentum (price well above rising moving averages). Offsetting these positives are weak recent free-cash-flow conversion and a very expensive valuation (P/E ~121). The latest earnings call was a net positive due to record results and improving margin guidance, though tariff, concentration, and ramp-cost risks remain.
Positive Factors
Strong balance sheet
Extremely low leverage and substantial equity provide durable financial flexibility to fund capex, withstand cyclical semiconductor demand swings, and pursue strategic investments without relying on external debt, reducing refinancing and liquidity risk over the medium term.
Negative Factors
Free-cash-flow volatility
Severe year-over-year FCF decline and low FCF-to-income indicate weaker cash conversion and sensitivity to investment and working-capital swings; this reduces optionality for returns to shareholders and heightens funding strain during the upcoming capex ramp.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong balance sheet
Extremely low leverage and substantial equity provide durable financial flexibility to fund capex, withstand cyclical semiconductor demand swings, and pursue strategic investments without relying on external debt, reducing refinancing and liquidity risk over the medium term.
Read all positive factors
Formfactor (FORM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.04B
Dividend YieldN/A
Average Volume (3M)1.39M
Price to Earnings (P/E)82.6
Beta (1Y)2.11
Revenue Growth2.29%
EPS Growth-69.81%
CountryUS
Employees2,238
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)0.46
Shares Outstanding77,917,946
10 Day Avg. Volume1,587,408
30 Day Avg. Volume1,390,683
Financial Highlights & Ratios
PEG Ratio-3.72
Price to Book (P/B)4.34
Price to Sales (P/S)5.72
P/FCF Ratio382.52
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue10.17
Enterprise Value/Gross Profit25.73
Enterprise Value/Ebitda85.51
Forecast
1Y Price Target
$82.13Price Target Upside-20.39% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)1.54
Revenue Forecast (FY)$908.01M
Formfactor Business Overview & Revenue Model
Company Description
FormFactor, Inc. designs, manufactures, and sells probe cards, analytical probes, probe stations, metrology systems, thermal systems, and cryogenic systems to semiconductor companies and scientific institutions. It operates in two segments, Probe ...
How the Company Makes Money
FormFactor primarily makes money by selling semiconductor test hardware, with revenue recognized from product shipments (and, where applicable, associated support). Its largest revenue stream is probe cards—custom, application-specific electro-mec...
Formfactor Key Performance Indicators (KPIs)
Formfactor Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call presented strong operational and financial momentum: record revenues, accelerating gross margin expansion (cumulative +540 bps since Q2 and +290 bps QoQ non-GAAP), improved cash generation, and confident Q1 guidance (revenue and margin expansion). Management executed structural cost and output improvements and is investing to scale (Farmers Branch, Keystone acquisition) to capture HBM, foundry/logic, GPU and custom ASIC opportunities. Key risks include a ~200 bps tariff headwind, near-term customer concentration in HBM, systems seasonality, capital-intensive ramp costs for Farmers Branch, and limited visibility beyond the quarter. Overall, the positive results, clear operational progress, and constructive guidance materially outweigh the headwinds and execution risks.Positive Updates
Record Revenue
Q4 2025 revenue of $215.2M came in at the high end of outlook and represented record quarterly and annual revenue for the company.
Negative Updates
Tariff Headwind
Estimated ~200 basis point negative impact to gross margins from tariffs. Management pursuing 'drawbacks' (customs recoveries) to mitigate, but recoveries could take several quarters to materialize and are uncertain.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Revenue
Q4 2025 revenue of $215.2M came in at the high end of outlook and represented record quarterly and annual revenue for the company.
Read all positive updates
Company Guidance
FormFactor guided Q1 FY2026 revenue of $225M ± $5M with non‑GAAP gross margin 45% ± 150 bps (noting ~200 bps headwind from tariffs and management expects another 100+–110 bps of sequential margin improvement in Q1), non‑GAAP operating expenses of $62M ± $2M (≈$4.5M higher than Q4), non‑GAAP EPS $0.45 ± $0.04, and a non‑GAAP tax rate of 15%–19%; this follows a Q4 beat ($215.2M revenue at the high end of a $205–$215M outlook), Q4 non‑GAAP gross margin of 43.9% (up 290 bps sequential from 41%), Q4 GAAP gross margin 42.2%, Q4 non‑GAAP EPS $0.46 ($0.29 GAAP), Q4 free cash flow $34.7M and operating cash flow $46M, cash & investments of $275M, and a plan to invest $140M–$170M of Farmers Branch capex in 2026 (with ~$6M preproduction OpEx in Q1 and $20M–$25M of preproduction OpEx for 2026), while targeting a long‑term model of 47% gross margin at an $850M run rate (≈45% when adjusted for the 200‑bp tariff impact).Formfactor Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
90
Very Positive
Cash Flow
58
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 784.99M | 763.60M | 663.10M | 747.94M | 769.67M |
| Gross Profit | 309.99M | 307.92M | 258.58M | 296.01M | 322.77M |
| EBITDA | 104.95M | 112.73M | 127.14M | 96.49M | 143.62M |
| Net Income | 54.36M | 69.61M | 82.39M | 50.74M | 83.92M |
Balance Sheet | |||||
| Total Assets | 1.22B | 1.15B | 1.11B | 1.01B | 1.02B |
| Cash, Cash Equivalents and Short-Term Investments | 276.24M | 360.02M | 328.32M | 238.14M | 276.06M |
| Total Debt | 44.85M | 39.23M | 48.15M | 50.37M | 63.27M |
| Total Liabilities | 189.04M | 198.45M | 197.99M | 199.94M | 204.74M |
| Stockholders Equity | 1.04B | 947.77M | 908.80M | 808.28M | 815.78M |
Cash Flow | |||||
| Free Cash Flow | 11.74M | 79.10M | 8.57M | 66.53M | 72.87M |
| Operating Cash Flow | 115.40M | 117.53M | 64.60M | 131.79M | 139.36M |
| Investing Cash Flow | -191.47M | -33.48M | 29.05M | -75.70M | -124.74M |
| Financing Cash Flow | -13.63M | -64.61M | -22.71M | -95.93M | -47.20M |
Formfactor Technical Analysis
Positive
103.16
Price Trends
90.76
Positive
74.77
Positive
55.22
Positive
Market Momentum
2.83
Negative
58.31
Neutral
52.80
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FORM, the sentiment is Positive. The current price of 103.16 is above the 20-day moving average (MA) of 95.27, above the 50-day MA of 90.76, and above the 200-day MA of 55.22, indicating a bullish trend. The MACD of 2.83 indicates Negative momentum. The RSI at 58.31 is Neutral, neither overbought nor oversold. The STOCH value of 52.80 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FORM.
Formfactor Risk Analysis
Formfactor disclosed 37 risk factors in its most recent earnings report. Formfactor reported the most risks in the "Ability to Sell" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Formfactor Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $2.92B | 21.10 | 11.72% | ― | -20.69% | -37.67% | |
73 Outperform | $8.04B | 82.61 | 5.43% | ― | 2.29% | -69.81% | |
73 Outperform | $3.15B | 34.57 | 3.55% | ― | 10.45% | 4.37% | |
64 Neutral | $2.91B | 90.19 | 3.17% | 2.27% | 10.50% | -52.00% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $3.35B | 37.65 | -7.72% | 1.77% | -7.38% | 99.38% | |
61 Neutral | $2.87B | -48.27 | -4.45% | ― | 13.24% | -129.14% |
* Technology Sector Average
FORM
Formfactor
103.16
78.79
323.31%
ACLS
Axcelis Technologies
95.09
50.24
112.02%
DIOD
Diodes
68.58
31.90
86.97%
KLIC
Kulicke & Soffa
64.08
35.39
123.34%
POWI
Power Integrations
52.37
9.92
23.37%
SYNA
Synaptics
74.15
28.59
62.75%
Formfactor Corporate Events
Executive/Board ChangesShareholder Meetings
FormFactor Announces Planned Board Retirement and Refresh
Neutral
Feb 18, 2026
On February 13, 2026, FormFactor director Kevin Brewer informed the board that he will retire from the board at the end of his current term and will not stand for re-election at the company’s 2026 annual meeting of stockholders, anticipated ...
Business Operations and Strategy
FormFactor Announces Major Restructuring and Facility Consolidation
Negative
Jan 9, 2026
On January 5, 2026, FormFactor, Inc. adopted restructuring plans aimed at better aligning its cost structure with its target financial model and improving gross margins, while consolidating manufacturing facilities in Carlsbad and Baldwin Park, Ca...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.