AXT (NASDAQ:AXTI) Stock Rating Upgraded by Needham & Company LLC

Key Points

• Needham upgraded AXT from “hold” to “buy” and set a $90 price target, implying 91.73% upside from the previous close. However, the broader analyst consensus remains “Hold” with a $66 target.
• AXT significantly exceeded second-quarter expectations, reporting $0.19 EPS versus $0.07 expected and $47.59 million in revenue versus $34.08 million expected. Management also issued strong third-quarter guidance of $0.30–$0.32 EPS, supported by demand for data-center optical connectivity.
• Risk factors include elevated volatility and insider selling: insiders sold approximately $27.8 million of stock last quarter, while the company continues to report negative net margins and a negative P/E ratio.

AXT (NASDAQ:AXTI - Get Free Report) was upgraded by investment analysts at Needham & Company LLC from a "hold" rating to a "buy" rating in a report issued on Friday. The firm currently has a $90.00 target price on the semiconductor company's stock. Needham & Company LLC's target price would indicate a potential upside of 91.73% from the company's previous close.

AXTI has been the topic of a number of other research reports. Northland Securities set a $125.00 price objective on AXT in a research note on Wednesday, June 3rd. B. Riley Financial cut their price target on AXT from $73.00 to $52.00 and set a "neutral" rating for the company in a report on Tuesday. Finally, Weiss Ratings raised shares of AXT from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Wednesday, May 27th. Three research analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, AXT currently has a consensus rating of "Hold" and a consensus price target of $66.00.

AXT Stock Up 27.0%

Shares of AXT stock opened at $46.94 on Friday. The stock has a market capitalization of $3.07 billion, a P/E ratio of -151.41 and a beta of 1.86. The company has a 50-day simple moving average of $77.44 and a 200 day simple moving average of $61.74. AXT has a 12-month low of $1.85 and a 12-month high of $143.16.

AXT (NASDAQ:AXTI - Get Free Report) last released its quarterly earnings results on Thursday, July 30th. The semiconductor company reported $0.19 EPS for the quarter, beating analysts' consensus estimates of $0.07 by $0.12. The firm had revenue of $47.59 million for the quarter, compared to analyst estimates of $34.08 million. AXT had a negative net margin of 14.69% and a negative return on equity of 5.71%. AXT has set its Q3 2026 guidance at 0.300-0.320 EPS. On average, equities analysts anticipate that AXT will post 0.19 earnings per share for the current year.

Insider Transactions at AXT

In related news, Director David C. Chang sold 8,333 shares of the business's stock in a transaction that occurred on Monday, June 15th. The shares were sold at an average price of $111.17, for a total transaction of $926,379.61. Following the completion of the sale, the director directly owned 65,165 shares of the company's stock, valued at $7,244,393.05. The trade was a 11.34% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at this link. Also, CEO Morris S. Young sold 123,601 shares of the stock in a transaction that occurred on Tuesday, June 2nd. The shares were sold at an average price of $113.33, for a total transaction of $14,007,701.33. Following the completion of the transaction, the chief executive officer owned 2,149,533 shares in the company, valued at $243,606,574.89. This represents a 5.44% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 251,636 shares of company stock worth $27,789,677 in the last quarter. 5.97% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of large investors have recently made changes to their positions in AXTI. Kestra Advisory Services LLC boosted its stake in AXT by 6.8% during the 1st quarter. Kestra Advisory Services LLC now owns 6,408 shares of the semiconductor company's stock worth $365,000 after acquiring an additional 408 shares during the last quarter. American Capital Advisory LLC bought a new stake in AXT in the first quarter valued at approximately $27,000. Kohmann Bosshard Financial Services LLC acquired a new stake in AXT in the first quarter worth $31,000. Leonteq Securities AG acquired a new stake in AXT in the first quarter worth $57,000. Finally, Tema ETFs LLC bought a new position in shares of AXT during the second quarter worth $105,000. Institutional investors and hedge funds own 49.52% of the company's stock.

AXT News Summary

Here are the key news stories impacting AXT this week:

• Positive Sentiment: Q2 results significantly exceeded expectations: AXT reported earnings of $0.19 per share versus the $0.07 consensus estimate, while revenue reached $47.59 million compared with expectations of approximately $34 million. The quarter marked a substantial improvement from the $0.15-per-share loss reported a year earlier. AXT Tops Q2 Earnings and Revenue Estimates
• Positive Sentiment: Very strong Q3 guidance: Management projected revenue of $66 million and EPS of $0.30-$0.32 for the third quarter, well above analyst estimates of roughly $38.7 million in revenue and $0.10 EPS. The outlook suggests accelerating customer demand and operating leverage. AXT Stock Rips Higher After Q2 Earnings
• Positive Sentiment: AI-related demand is supporting growth: AXT cited strong demand for data-center optical connectivity, helping drive revenue growth and improved profitability. Management described the business as reaching an inflection point. AXT Announces Second Quarter 2026 Financial Results
• Positive Sentiment: Long-term customer agreement: AXT secured a multiyear indium phosphide wafer supply and capacity-reservation agreement with Lumentum, providing greater visibility into future demand. AXT Announces Long-Term Supplier Agreement with Lumentum
• Neutral Sentiment: Insider selling remains a risk to monitor: A third-party analysis reported 33 insider sales and no purchases during the past six months. These transactions may reflect scheduled selling, but they could temper investor enthusiasm after the rally.
• Negative Sentiment: Valuation and volatility are elevated: The stock remains well above its 50-day and 200-day moving averages, while its price-to-earnings ratio is negative. This leaves shares vulnerable to profit-taking if AI-related growth or future guidance falls short.

AXT Company Profile

AXT, Inc NASDAQ: AXTI is a global supplier of compound and single-element semiconductor substrates, offering a range of materials critical for high-performance electronic and optoelectronic devices. Founded in 1986 and headquartered in Fremont, California, AXT specializes in the development, manufacture and distribution of wafers composed of gallium arsenide (GaAs), indium phosphide (InP), gallium nitride (GaN) and other compound semiconductor materials. These substrates serve as the foundational platforms for devices used in data communications, wireless infrastructure, advanced computing, consumer electronics and photovoltaic applications.

AXT's product portfolio encompasses a variety of wafer sizes, dopant concentrations and crystal orientations, tailored to meet the precise specifications of its customers.

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