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Nova's Q1 2024 Results Exceed Expectations, Driven by Increased Demand for State-of-the-Art Portfolio

By Don Francis, Editor
May 14, 2024 9:35 AM UTC
Nova's Q1 2024 Results Exceed Expectations, Driven by Increased Demand for State-of-the-Art Portfolio

Jefferies's Blayne Curtis assumed coverage on Nova (NASDAQ: NVMI) with a Strong Buy rating. The analyst also raised their price target by 20% from $200 to $240.

According to Curtis, the U.S. semiconductor industry is poised for a strong upcycle, and Nova is well-positioned to benefit from this trend. The analyst believes that the sector is still in the early stages of the cycle and that the current cycle will be even stronger with the integration of artificial intelligence (AI) technology.

Nova's first-quarter 2024 financial results exceeded expectations. The company reported earnings per share (EPS) of $1.39, beating the consensus estimate of $1.28, and representing a 13% increase compared to the same period last year. Additionally, Nova's revenue for the quarter reached $141.8 million, surpassing the consensus estimate of $136.8 million and showing a 7.3% increase year-over-year.

Looking ahead to the second quarter of 2024, Nova's management has provided guidance of revenue ranging from $144 million to $152 million, and EPS between $1.27 and $1.42. President and CEO Gaby Waisman expressed satisfaction with the company's performance, stating that it was driven by increased demand for Nova's state-of-the-art portfolio and supported by a robust operational model. Waisman also highlighted Nova's diverse exposure to opportunities across various markets, territories, customers, and technologies.

In addition to the positive coverage of Nova, Curtis made several changes to other stocks in their portfolio. They lowered the price target on Applied Materials Inc by 2.3% and downgraded the stock from Strong Buy to Hold. The price target on Interdigital Inc was also lowered by 5.7%, and the stock was downgraded to Hold. Similarly, the price target on Navitas Semiconductor Corp was reduced by a significant 60%, and the stock was downgraded to Hold. Curtis also lowered the price target on Arteris Inc by 18.2% and downgraded the stock to Hold. On the other hand, the price target on Advanced Micro Devices Inc was lowered by 5%, but the Strong Buy rating was maintained.

Analysts' ratings on Nova are overwhelmingly positive, with 100% of top-rated analysts currently rating the stock as either a Strong Buy or Buy. None of the analysts surveyed see the stock as a Hold, and there are no recommendations to sell the stock.

Since Nova's latest quarterly report on May 9, 2024, the stock price has increased by 0.2%. Year-over-year, the stock has shown significant growth, with an increase of 100.9%. During this period, Nova has outperformed the S&P 500, which has seen a growth of 26.2%.

Blayne Curtis, the Jefferies analyst who assumed coverage on Nova, is highly regarded in the industry. Ranked in the top 4% out of 4,581 Wall Street analysts by WallStreetZen, Curtis has an average return of 13.4% and a win rate of 50%. They specialize in the Technology and Communication Services sectors.

Nova Ltd., formerly known as Nova Measuring Instruments Ltd., designs, develops, produces, and sells process control systems used in the manufacture of semiconductors. The company operates globally, serving various sectors of the integrated circuit manufacturing industry. Nova's product portfolio includes metrology platforms for dimensional, films, and materials and chemical metrology measurements. The company's advanced technologies, such as Elipson and Metrion, have gained market traction and are undergoing evaluations by multiple customers.

What are the top analysts forecasting for Nova?

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