Tower Semiconductor (NASDAQ:TSEM) Trading 7.2% Higher - Still a Buy?

Key Points

• Shares jumped 7.2% mid-day to about $127 (intraday high $128.98) on Friday, with trading volume ~787,684 shares—roughly 61% below the stock's average daily volume.
• Analysts are mixed: two Buy and three Hold ratings result in a consensus Hold and a consensus target price of $156.75, even as several firms raised their individual targets (e.g., Susquehanna $180, Benchmark $165).
• Tower beat expectations this quarter with EPS of $0.78 vs. $0.67 expected and revenue of $440.2M (up 13.7% YoY), and shows strong fundamentals including low debt (debt/equity 0.05), high liquidity (current ratio 6.48) and ~70.5% institutional ownership.

Shares of Tower Semiconductor Ltd. (NASDAQ:TSEM - Get Free Report) rose 7.2% during mid-day trading on Friday . The company traded as high as $128.98 and last traded at $127.09. Approximately 787,684 shares were traded during mid-day trading, a decline of 61% from the average daily volume of 2,042,749 shares. The stock had previously closed at $118.54.

Analysts Set New Price Targets

Several research firms have weighed in on TSEM. Weiss Ratings reiterated a "hold (c)" rating on shares of Tower Semiconductor in a research note on Monday, December 29th. Susquehanna reaffirmed a "positive" rating and set a $180.00 target price on shares of Tower Semiconductor in a report on Thursday, February 12th. Barclays upped their target price on Tower Semiconductor from $114.00 to $142.00 and gave the company an "equal weight" rating in a research report on Friday, February 13th. Wedbush raised their price target on shares of Tower Semiconductor from $125.00 to $140.00 and gave the stock a "neutral" rating in a research report on Thursday, February 12th. Finally, Benchmark lifted their price objective on shares of Tower Semiconductor from $150.00 to $165.00 and gave the company a "buy" rating in a research note on Thursday, February 12th. Two research analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus target price of $156.75.

Tower Semiconductor Stock Performance

The firm has a fifty day moving average of $127.29 and a 200 day moving average of $101.57. The company has a debt-to-equity ratio of 0.05, a current ratio of 6.48 and a quick ratio of 5.51. The stock has a market capitalization of $14.22 billion, a price-to-earnings ratio of 65.35 and a beta of 0.91.

Tower Semiconductor (NASDAQ:TSEM - Get Free Report) last announced its quarterly earnings results on Wednesday, February 11th. The semiconductor company reported $0.78 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.67 by $0.11. The company had revenue of $440.21 million during the quarter, compared to the consensus estimate of $439.81 million. Tower Semiconductor had a return on equity of 7.86% and a net margin of 14.08%.Tower Semiconductor's revenue for the quarter was up 13.7% on a year-over-year basis. During the same period in the previous year, the company posted $0.49 earnings per share. On average, sell-side analysts anticipate that Tower Semiconductor Ltd. will post 1.67 earnings per share for the current fiscal year.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. Senvest Management LLC boosted its stake in shares of Tower Semiconductor by 0.9% in the second quarter. Senvest Management LLC now owns 8,128,614 shares of the semiconductor company's stock worth $352,375,000 after acquiring an additional 69,207 shares during the last quarter. Price T Rowe Associates Inc. MD raised its stake in Tower Semiconductor by 3,222.6% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 4,682,152 shares of the semiconductor company's stock valued at $549,779,000 after purchasing an additional 4,541,235 shares during the last quarter. Vanguard Group Inc. lifted its holdings in Tower Semiconductor by 1.2% in the 4th quarter. Vanguard Group Inc. now owns 4,338,080 shares of the semiconductor company's stock valued at $507,317,000 after purchasing an additional 53,112 shares in the last quarter. Migdal Insurance & Financial Holdings Ltd. boosted its stake in Tower Semiconductor by 0.8% during the 4th quarter. Migdal Insurance & Financial Holdings Ltd. now owns 3,002,806 shares of the semiconductor company's stock worth $352,589,000 after purchasing an additional 25,000 shares during the last quarter. Finally, Jennison Associates LLC boosted its stake in Tower Semiconductor by 18.8% during the 3rd quarter. Jennison Associates LLC now owns 2,331,831 shares of the semiconductor company's stock worth $168,591,000 after purchasing an additional 369,600 shares during the last quarter. Hedge funds and other institutional investors own 70.51% of the company's stock.

Tower Semiconductor Company Profile

Tower Semiconductor, traded on NASDAQ under the symbol TSEM, is a specialty foundry company that provides analog and mixed-signal semiconductor manufacturing services to a broad array of customers worldwide. The company focuses on delivering tailored process technologies for high-growth markets, including radio frequency (RF), power management, imaging, automotive electronics, and Internet of Things (IoT) applications. By combining deep process know-how with flexible manufacturing capabilities, Tower Semiconductor supports the development and volume production of advanced semiconductor devices for fabless and integrated device manufacturer customers.

The company's technology portfolio spans standard and specialty processes such as CMOS, BiCMOS, high-voltage, radio frequency, silicon photonics, micro-electromechanical systems (MEMS) and image sensor production.

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