Rambus (NASDAQ:RMBS) Shares Gap Up - Should You Buy?

Key Points

• Shares gapped up premarket, opening at $149.67 versus a $138.50 close and trading around $148.77 (about +13.8%) on elevated volume, well above the 50- and 200-day SMAs near $100 and giving the company a market cap of roughly $17.0B.
• Analysts are mixed: the consensus from MarketBeat is a "Moderate Buy" with an average target of $105.71, while some firms have recently cut targets (e.g., to $119 and $90) and ratings range from Strong Buy to Hold.
• Fundamentals and ownership: Rambus reported Qtrly EPS of $0.68 (in line) and slight revenue beat, but insiders have been selling (58,151 shares worth ~$5.85M in the last three months under 10b5‑1 plans) while institutional investors own about 88.5% of the stock and insiders only 0.75%.

Rambus, Inc. (NASDAQ:RMBS - Get Free Report)'s share price gapped up prior to trading on Friday . The stock had previously closed at $138.50, but opened at $149.67. Rambus shares last traded at $148.7690, with a volume of 406,423 shares.

Analysts Set New Price Targets

A number of analysts have recently weighed in on the stock. William Blair initiated coverage on shares of Rambus in a report on Thursday, January 22nd. They issued an "outperform" rating on the stock. Rosenblatt Securities reaffirmed a "buy" rating and set a $130.00 price target on shares of Rambus in a research note on Tuesday, February 3rd. Weiss Ratings cut shares of Rambus from a "buy (b-)" rating to a "hold (c+)" rating in a research note on Tuesday, March 10th. Evercore dropped their price target on shares of Rambus from $126.00 to $119.00 and set an "outperform" rating for the company in a research note on Tuesday, February 3rd. Finally, Susquehanna dropped their price target on shares of Rambus from $100.00 to $90.00 and set a "neutral" rating for the company in a research note on Tuesday, February 3rd. Two equities research analysts have rated the stock with a Strong Buy rating, five have issued a Buy rating and three have assigned a Hold rating to the company. According to data from MarketBeat.com, Rambus presently has an average rating of "Moderate Buy" and an average target price of $105.71.

Rambus Trading Up 13.8%

The company has a market capitalization of $17.04 billion, a PE ratio of 74.52 and a beta of 1.63. The firm's 50-day simple moving average is $100.56 and its 200-day simple moving average is $100.52.

Rambus (NASDAQ:RMBS - Get Free Report) last released its quarterly earnings data on Monday, February 2nd. The semiconductor company reported $0.68 earnings per share (EPS) for the quarter, meeting the consensus estimate of $0.68. The company had revenue of $190.24 million during the quarter, compared to analysts' expectations of $188.21 million. Rambus had a net margin of 32.57% and a return on equity of 17.69%. As a group, analysts anticipate that Rambus, Inc. will post 2.49 EPS for the current year.

Insider Buying and Selling at Rambus

In other Rambus news, CEO Luc Seraphin sold 5,426 shares of the business's stock in a transaction dated Thursday, April 2nd. The shares were sold at an average price of $86.65, for a total value of $470,162.90. Following the completion of the sale, the chief executive officer directly owned 345,767 shares of the company's stock, valued at $29,960,710.55. The trade was a 1.55% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Meera Rao sold 8,538 shares of the business's stock in a transaction dated Tuesday, April 14th. The shares were sold at an average price of $118.08, for a total transaction of $1,008,167.04. Following the completion of the sale, the director directly owned 22,946 shares of the company's stock, valued at approximately $2,709,463.68. This trade represents a 27.12% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 58,151 shares of company stock valued at $5,848,885 in the last three months. Company insiders own 0.75% of the company's stock.

Institutional Investors Weigh In On Rambus

Several hedge funds have recently modified their holdings of the business. Krilogy Financial LLC lifted its position in shares of Rambus by 3.8% in the 1st quarter. Krilogy Financial LLC now owns 2,238 shares of the semiconductor company's stock worth $193,000 after purchasing an additional 81 shares during the period. Oak Grove Capital LLC lifted its position in shares of Rambus by 1.3% in the 4th quarter. Oak Grove Capital LLC now owns 7,600 shares of the semiconductor company's stock worth $698,000 after purchasing an additional 100 shares during the period. Northwestern Mutual Investment Management Company LLC lifted its position in shares of Rambus by 0.4% in the 4th quarter. Northwestern Mutual Investment Management Company LLC now owns 24,085 shares of the semiconductor company's stock worth $2,213,000 after purchasing an additional 103 shares during the period. Ashton Thomas Private Wealth LLC lifted its position in shares of Rambus by 3.3% in the 4th quarter. Ashton Thomas Private Wealth LLC now owns 3,445 shares of the semiconductor company's stock worth $317,000 after purchasing an additional 110 shares during the period. Finally, Meeder Advisory Services Inc. lifted its position in shares of Rambus by 3.0% in the 4th quarter. Meeder Advisory Services Inc. now owns 3,883 shares of the semiconductor company's stock worth $357,000 after purchasing an additional 114 shares during the period. Hedge funds and other institutional investors own 88.54% of the company's stock.

About Rambus

Rambus Inc is a technology licensing company specializing in semiconductor and system-level interface solutions. Founded in 1990 by Stanford University researchers Mike Farmwald and Mark Horowitz, Rambus established its headquarters in Sunnyvale, California. The company initially gained prominence by developing high-speed DRAM interface technology and securing a broad patent portfolio covering memory architecture, data signaling and power management innovations.

Today, Rambus licenses its proprietary intellectual property (IP) to semiconductor companies, original equipment manufacturers (OEMs) and system integrators worldwide.

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