Shares of FormFactor Inc (NASDAQ:FORM) climbed sharply on Thursday following the company's announcement of fourth-quarter earnings that surpassed market expectations, coupled with a positive forecast for the first quarter of the new fiscal year. Investors have responded enthusiastically to the company's financial disclosures, which highlighted strong profitability and revenue growth, as well as a confident outlook that points to sustained performance.
In detail, FormFactor reported fourth-quarter earnings of $0.46 per share, significantly outperforming the consensus estimate of $0.35 per share. This marked a meaningful increase from the 27 cents reported in the same quarter a year earlier, showcasing more than a 70% rise in earnings per share. Revenue in the quarter totaled $215.16 million, reflecting a 13.6% year-over-year increase and surpassing analysts' projections.
The company’s outlook for the first quarter further bolstered investor sentiment. FormFactor provided adjusted earnings guidance ranging from $0.41 to $0.49 per share, above the $0.32 forecast from analysts. Corresponding revenue guidance was set between $220 million and $230 million, comfortably exceeding the consensus expectation of approximately $203.53 million. This optimistic guidance reinforces the company's ability to maintain its upward trajectory as it enters the new fiscal period.
Operational metrics also demonstrated financial strength. On a non-GAAP basis, net income rose substantially to $36.6 million, up from $21.3 million in the prior year’s quarter. Meanwhile, robust cash flow generation was evident, with operating cash flow reaching $46 million in the fourth quarter and free cash flow amounting to $34.7 million. These cash flow figures underline the company’s healthy liquidity position and operational efficiency.
From a technical perspective, FormFactor's stock displayed significant bullish momentum by trading well above key moving averages at the time of reporting. Specifically, the share price stood 15.1% above the 20-day simple moving average (SMA), 33.2% above the 50-day SMA, and an impressive 99% above the 200-day SMA. This pattern signals a strong upward trend in the stock’s pricing dynamics.
The Relative Strength Index (RSI) for FormFactor was at 53.57, positioning the stock in a neutral zone. This suggests balanced trading momentum with potential for further gains before overbought conditions might emerge. However, the Moving Average Convergence Divergence (MACD) indicator was below its signal line, indicating some short-term bearish pressure even as the broader trend remains positive.
Traders and investors are closely monitoring the resistance level situated at $85.50. Should FormFactor's share price break above this threshold, it may trigger additional bullish momentum. Conversely, a significant price drop could prompt a search for support levels to identify possible buying opportunities.
Analyzing the stock’s year-long performance, FormFactor has posted a substantial gain of approximately 105.17%. This powerful upward movement brings the share price to nearly 98.2% of its 52-week range, signaling proximity to the highest price point recorded during the past year.
At the time of reporting on Thursday, FormFactor shares were trading up 18.96% at $85.14, just shy of the 52-week high of $85.48. This surge reflects investor confidence fueled by the company's recent earnings beat and favorable forecasts.