Analysts Offer Insights on Consumer Goods Companies: Emcore Corp (NASDAQ: EMKR) and Kulicke & Soffa (NASDAQ: KLIC)

By Austin Angelo

There’s a lot to be optimistic about in the Consumer Goods sector as 2 analysts just weighed in on Emcore Corp (EMKRResearch Report) and Kulicke & Soffa (KLICResearch Report) with bullish sentiments.

Emcore Corp (EMKR)

B.Riley FBR analyst Dave Kang maintained a Buy rating on Emcore Corp today and set a price target of $4.90. The company’s shares closed yesterday at $3.29, close to its 52-week low of $3.14.

Kang noted:

“AMC, EMCORE (EMKR) lowered F3Q revenue outlook from $20M-$22M to $17.0M-$17.5M. The company cited two factors regarding revenue shortfall: 1) Negative effects from the trade dispute with China; and 2) continued soft spending in the CATV industry. Although the revenue shortfall was disappointing, we remain encouraged by the company’s transformation from a CATV component supplier to a more balanced module supplier. Meanwhile, the company is in the process of integrating recently-acquired Systron Donner Inertial (SDI). We expect this acquisition to significantly expand the company’s navigation TAM. To reflect the revenue preannouncement, we are lowering our FY19/FY20 EPS estimates from ($0.27)/($0.05) to ($0.43)/($0.19), and reduce our price target from $5.60 to $4.90. We maintain our Buy rating based on valuation.”

According to TipRanks.com, Kang is a 5-star analyst with an average return of 19.4% and a 64.3% success rate. Kang covers the Consumer Goods sector, focusing on stocks such as DASAN Zhone Solutions Inc, Applied Optoelectronics, and Acacia Communications.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for Emcore Corp with a $5.53 average price target, implying a 68.1% upside from current levels. In a report issued on June 28, Northland Securities also maintained a Buy rating on the stock with a $6 price target.

See today’s analyst top recommended stocks >>

Kulicke & Soffa (KLIC)

B.Riley FBR analyst Craig Ellis assigned a Buy rating to Kulicke & Soffa today and set a price target of $27. The company’s shares closed yesterday at $21.52.

Ellis noted:

“We plan to update estimates in the coming weeks. Third, SAM expansion initiatives are bearing fruit in numerous areas. Specifically, we believe new high-margin mini-LED products could add $50.0M and $100.0M to FY20 and FY21 sales, respectively. Further out, new Advanced Packaging products (high accuracy flip chip and thermo compression bonder) could add material FY21/22 sales. We believe these show CEO Fusen Chen’s R&D organizational changes are bearing fruit. Fourth, we sense ongoing commitment to steady cash return, so we suspect T-7 quarter SBB action around ~$21.0M quarter can persist with $145.3M SBB left on an authorization worth 6.8M/10% of shares out, or $0.20+ to LT EPS.”

According to TipRanks.com, Ellis is a 5-star analyst with an average return of 13.2% and a 58.5% success rate. Ellis covers the Consumer Goods sector, focusing on stocks such as Applied Materials Inc, Axcelis Technologies, and Rudolph Technologies.

Currently, the analyst consensus on Kulicke & Soffa is a Moderate Buy with an average price target of $26.50.

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