In a recent transaction, Mike Slessor, the CEO of FormFactor Inc. (NASDAQ:FORM), sold shares of the company's stock, totaling over $236,000. The shares were sold at prices ranging from $58.4374 to $60.5742, according to a Form 4 document filed with the Securities and Exchange Commission.
The series of transactions took place on July 1, 2024, and were executed automatically pursuant to a Rule 10b5-1 trading plan that was adopted on November 20, 2023. The plan is a common arrangement that allows company insiders to sell shares at predetermined times to avoid accusations of insider trading.
The first transaction involved the sale of 2,323 shares at an average price of $58.4374, with individual sale prices varying from $57.955 to $58.95. In the second transaction, Slessor sold 995 shares at an average price of $59.2357, with a price range of $58.965 to $59.415. The final transaction reported was the sale of 682 shares at an average price of $60.5742, with the sales prices ranging from $60.375 to $60.61.
Following these transactions, the CEO still holds a substantial number of shares in FormFactor, with the ownership standing at 487,581 shares after the sales were completed.
Investors often monitor insider buying and selling as it can provide insights into a company's internal perspective and financial health. The transactions are publicly disclosed to ensure transparency and provide investors with the information needed to make informed decisions.
In other recent news, FormFactor has been the focus of several analyst reports following its robust earnings and revenue forecasts. B.Riley raised FormFactor's price target to $65.00, maintaining a Buy rating due to an anticipated 20% upside. The analyst's optimism is rooted in the potential for substantial growth in FormFactor's revenue streams related to semiconductor manufacturing.
Similarly, Needham lifted the price target for FormFactor to $53.00, reaffirming a Buy rating. This follows FormFactor's robust earnings and a revenue forecast for the second quarter of 2024, suggesting significant sequential growth. The company's management attributes this growth to factors including ongoing high demand for High Bandwidth (NASDAQ:BAND) Memory (HBM).
Citi also increased its stock price target for FormFactor to $46.00, maintaining a Neutral rating. This adjustment follows the company's strong performance driven by robust demand for advanced packaging HBM DRAM and logic. Citi's analyst projects that second-half sales for FormFactor will likely be in the range of $185-190 million.
TD Cowen raised the price target for FormFactor shares to $48, maintaining a Hold rating. Despite some challenges facing FormFactor, the upward guidance provided by the company and the potential for growth in demand for its products have led to the revised price target. These are recent developments that investors should consider.
InvestingPro Insights
As investors digest the recent insider transactions by FormFactor Inc.'s CEO, Mike Slessor, it's valuable to consider the broader financial landscape of the company through the lens of InvestingPro. With a market capitalization of approximately $4.7 billion and a notable P/E ratio of 46.21, FormFactor presents a complex picture. The P/E ratio, which has adjusted to a striking 197.95 for the last twelve months as of Q1 2024, suggests a high valuation relative to near-term earnings growth.
However, a more granular analysis reveals a PEG ratio of 0.13 for the same period, indicating that the company's earnings growth may outpace its P/E ratio, which can be an attractive signal for investors seeking growth opportunities. Moreover, FormFactor's stock has experienced substantial appreciation, with a 78.02% one-year price total return, trading close to its 52-week high at 97.24% of the peak price.
InvestingPro Tips highlight several key factors: FormFactor holds more cash than debt on its balance sheet, suggesting financial stability and liquidity. Additionally, the company is trading at a low P/E ratio relative to near-term earnings growth, despite its high earnings multiple. This contrast may present an opportunity for investors who have confidence in the company's growth trajectory.
For those interested in a deeper dive, there are over 6 additional InvestingPro Tips available for FormFactor, which can be accessed at https://www.investing.com/pro/FORM. To enhance your investing strategy, consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing a wealth of data and insights to inform your investment decisions.
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