Nova (NASDAQ:NVMI) Stock Sees Unusually High Call Option Buying

Key Points

• Call-option activity surged: Investors bought 2,892 Nova call options, 488% above the average volume of 492.
• Analyst targets have come down despite a Moderate Buy consensus: The average price target is $470, while Citigroup cut its target from $550 to $415 and shifted its rating to Neutral. Six analysts rate the stock Buy and four rate it Hold.
• Nova beat quarterly estimates and authorized a buyback: Earnings of $2.86 per share and revenue of $287.84 million exceeded forecasts, with revenue up 28.2% year over year; the company also approved up to $200 million in share repurchases.

Nova Ltd. (NASDAQ:NVMI - Get Free Report) was the target of some unusual options trading on Monday. Investors bought 2,892 call options on the stock. This represents an increase of 488% compared to the average volume of 492 call options.

Analysts Set New Price Targets

Several research analysts have recently weighed in on the stock. Zacks Research downgraded shares of Nova from a "strong-buy" rating to a "hold" rating in a research note on Monday, October 5th. Citigroup lowered shares of Nova from a "buy" rating to a "neutral" rating and cut their price objective for the stock from $550.00 to $415.00 in a report on Thursday, October 8th. Evercore set a $475.00 price objective on shares of Nova in a report on Friday, August 7th. Cantor Fitzgerald decreased their price objective on shares of Nova from $600.00 to $500.00 and set an "overweight" rating for the company in a research report on Friday, August 7th. Finally, Barclays lowered their target price on Nova from $600.00 to $500.00 and set an "overweight" rating for the company in a research note on Friday. Six analysts have rated the stock with a Buy rating and four have given a Hold rating to the stock. According to data from MarketBeat.com, Nova currently has an average rating of "Moderate Buy" and an average price target of $470.00.

Nova Stock Up 6.0%

Shares of Nova stock traded up $18.90 on Monday, hitting $332.08. 39,229 shares of the company's stock traded hands, compared to its average volume of 438,039. Nova has a 52-week low of $266.43 and a 52-week high of $615.99. The company has a quick ratio of 5.39, a current ratio of 6.21 and a debt-to-equity ratio of 0.49. The stock has a market cap of $10.55 billion, a P/E ratio of 37.62, a PEG ratio of 1.34 and a beta of 1.85. The firm's 50-day moving average is $346.38 and its 200 day moving average is $437.27.

Nova (NASDAQ:NVMI - Get Free Report) last issued its quarterly earnings results on Thursday, November 5th. The semiconductor company reported $2.86 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $2.77 by $0.09. The business had revenue of $287.84 million during the quarter, compared to analyst estimates of $282.23 million. Nova had a net margin of 29.87% and a return on equity of 22.13%. The business's revenue was up 28.2% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $2.16 earnings per share. Nova has set its Q4 2026 guidance at 3.030-3.180 EPS. Equities analysts anticipate that Nova will post 10.02 earnings per share for the current year.

Nova announced that its board has authorized a share buyback program on Wednesday, September 2nd that permits the company to buy back $200 million in outstanding shares. This repurchase authorization permits the semiconductor company to reacquire up to 1.9% of its stock through open market purchases. Share repurchase programs are typically a sign that the company's management believes its stock is undervalued.

Insider Activity at Nova

In other Nova news, insider Shay Wolfing sold 3,864 shares of the stock in a transaction that occurred on Monday, September 21st. The shares were sold at an average price of $363.28, for a total value of $1,403,713.92. Following the completion of the sale, the insider owned 21,409 shares of the company's stock, valued at $7,777,461.52. This trade represents a 15.29% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Gabriel Waisman sold 1,500 shares of the stock in a transaction that occurred on Tuesday, September 1st. The shares were sold at an average price of $342.27, for a total transaction of $513,405.00. Following the completion of the sale, the chief executive officer directly owned 27,214 shares of the company's stock, valued at $9,314,535.78. This trade represents a 5.22% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders own 1.00% of the company's stock.

Institutional Trading of Nova

Several hedge funds have recently bought and sold shares of the company. Harel Insurance Investments & Financial Services Ltd. lifted its stake in shares of Nova by 47.5% in the 1st quarter. Harel Insurance Investments & Financial Services Ltd. now owns 2,166,073 shares of the semiconductor company's stock worth $940,683,000 after acquiring an additional 697,210 shares during the period. Migdal Insurance & Financial Holdings Ltd. boosted its holdings in shares of Nova by 5.3% in the third quarter. Migdal Insurance & Financial Holdings Ltd. now owns 1,706,657 shares of the semiconductor company's stock valued at $657,404,000 after acquiring an additional 86,000 shares in the last quarter. Phoenix Financial Ltd. boosted its holdings in shares of Nova by 133.2% in the third quarter. Phoenix Financial Ltd. now owns 1,440,315 shares of the semiconductor company's stock valued at $554,671,000 after acquiring an additional 822,684 shares in the last quarter. BlackRock Inc. acquired a new position in shares of Nova during the second quarter valued at approximately $391,367,000. Finally, Bank of America Corp DE acquired a new position in shares of Nova during the second quarter valued at approximately $308,300,000. 82.99% of the stock is currently owned by institutional investors.

Nova Company Profile

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