Ultra Clean (NASDAQ:UCTT) Shares Gap Up - Should You Buy?

Key Points

• Ultra Clean shares surged 18.4%, opening at $77.50 versus a prior close of $69.57 and later trading near $79.96.
• Analyst sentiment is broadly positive: MarketBeat reports an average “Buy” rating and an average price target of $113.40, with TD Cowen raising its target to $130.
• The company beat quarterly earnings expectations, reporting $0.31 in adjusted EPS versus $0.27 expected and $533.7 million in revenue, while insiders have sold about $5.84 million of stock over the past three months.

Ultra Clean Holdings, Inc. (NASDAQ:UCTT - Get Free Report)'s share price gapped up prior to trading on Thursday . The stock had previously closed at $69.57, but opened at $77.50. Ultra Clean shares last traded at $79.9550, with a volume of 284,202 shares trading hands.

Wall Street Analyst Weigh In

Several analysts recently weighed in on UCTT shares. TD Cowen lifted their price target on Ultra Clean from $100.00 to $130.00 and gave the stock a "buy" rating in a report on Thursday, July 9th. Oppenheimer upped their price objective on Ultra Clean from $100.00 to $115.00 and gave the company an "outperform" rating in a report on Tuesday, June 9th. Needham & Company LLC increased their price objective on Ultra Clean from $70.00 to $92.00 and gave the stock a "buy" rating in a research report on Wednesday, April 29th. Zacks Research raised Ultra Clean from a "hold" rating to a "strong-buy" rating in a report on Monday, May 25th. Finally, Wall Street Zen raised shares of Ultra Clean from a "hold" rating to a "buy" rating in a research report on Tuesday, July 7th. Two equities research analysts have rated the stock with a Strong Buy rating, four have given a Buy rating and one has given a Sell rating to the company. According to MarketBeat, the company currently has an average rating of "Buy" and an average target price of $113.40.

Ultra Clean Trading Up 18.4%

The firm has a market capitalization of $3.69 billion, a P/E ratio of -19.09, a PEG ratio of 1.03 and a beta of 1.83. The company has a quick ratio of 1.72, a current ratio of 3.07 and a debt-to-equity ratio of 0.86. The firm has a 50 day moving average of $100.48 and a 200-day moving average of $75.46.

Ultra Clean (NASDAQ:UCTT - Get Free Report) last announced its quarterly earnings data on Tuesday, April 28th. The semiconductor company reported $0.31 earnings per share for the quarter, beating the consensus estimate of $0.27 by $0.04. Ultra Clean had a positive return on equity of 4.28% and a negative net margin of 9.38%.The firm had revenue of $533.70 million during the quarter, compared to analysts' expectations of $525.28 million. During the same period in the previous year, the firm earned $0.28 EPS. The company's quarterly revenue was up 2.9% compared to the same quarter last year. On average, equities research analysts predict that Ultra Clean Holdings, Inc. will post 2.14 earnings per share for the current fiscal year.

Insider Activity

In other Ultra Clean news, General Counsel Paul Yoonku Cho sold 944 shares of the stock in a transaction dated Tuesday, June 2nd. The shares were sold at an average price of $89.37, for a total transaction of $84,365.28. Following the sale, the general counsel directly owned 22,941 shares in the company, valued at $2,050,237.17. This represents a 3.95% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, insider Jeffrey L. Mckibben sold 4,205 shares of the firm's stock in a transaction dated Thursday, May 14th. The shares were sold at an average price of $87.00, for a total transaction of $365,835.00. Following the completion of the transaction, the insider directly owned 11,349 shares in the company, valued at approximately $987,363. This represents a 27.03% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders sold 68,203 shares of company stock valued at $5,838,174. Company insiders own 1.80% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in the company. Quadrant Capital Group LLC boosted its holdings in shares of Ultra Clean by 40.3% in the 4th quarter. Quadrant Capital Group LLC now owns 989 shares of the semiconductor company's stock valued at $25,000 after purchasing an additional 284 shares in the last quarter. Danske Bank A S lifted its position in shares of Ultra Clean by 450.0% during the 4th quarter. Danske Bank A S now owns 1,100 shares of the semiconductor company's stock worth $28,000 after buying an additional 900 shares during the last quarter. AdvisorNet Financial Inc bought a new stake in shares of Ultra Clean during the 1st quarter worth $34,000. Smartleaf Asset Management LLC boosted its stake in Ultra Clean by 472.9% in the second quarter. Smartleaf Asset Management LLC now owns 1,713 shares of the semiconductor company's stock valued at $39,000 after buying an additional 1,414 shares in the last quarter. Finally, EverSource Wealth Advisors LLC boosted its stake in Ultra Clean by 37.3% in the first quarter. EverSource Wealth Advisors LLC now owns 721 shares of the semiconductor company's stock valued at $45,000 after buying an additional 196 shares in the last quarter. 96.06% of the stock is currently owned by institutional investors and hedge funds.

Ultra Clean Company Profile

Ultra Clean Holdings, Inc is a global supplier of critical consumables and process tools for the semiconductor manufacturing industry. The company specializes in precision parts cleaning, chemical–mechanical planarization (CMP) slurries, surface conditioning pads, and specialty components used in wafer fabrication and advanced packaging. Ultra Clean also provides assembly and test hardware, tooling, and automated modules designed to support complex front-end and back-end processes in semiconductor fabs.

Ultra Clean's product portfolio encompasses a range of cleaning systems and consumables aimed at particle and film removal, as well as CMP slurries and pads that are engineered for uniform material removal and planarization.

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