Jefferies raises Camtek stock price target to $105 on HPC growth

Investing.com - Jefferies raised its price target on Camtek (NASDAQ:CAMT), a $4.1 billion market cap semiconductor equipment maker, to $105.00 from $85.00 on Tuesday, while maintaining a Buy rating. The stock currently trades at $89.67, with InvestingPro data showing impressive revenue growth of 32.6% over the last twelve months.

The research firm cited "another solid quarter led by HPC" with CoWoS-like sales to OSATs driving growth. CoWoS technology now comprises over half of Camtek’s HPC business, helping offset a cautious approach from HBM customers who are waiting for NVIDIA (NASDAQ:NVDA) orders ahead of potential Samsung (KS:005930) qualification. This performance contributes to Camtek’s "GREAT" financial health score on InvestingPro, supported by strong liquidity with a current ratio of 5.28.

Jefferies noted that Camtek expects growth in 2026, though specific details about the magnitude remain limited pending more clarity on the HBM market. The firm believes the risk of an HBM correction if Samsung qualifies for HBM4 continues to diminish as other segments of Camtek’s business expand.

The technology roadmap for Camtek remains strong with Eagle Gen 5 ramping throughout the year and the Hawk system expected to ramp in the second half, offering the ability to detect defects as small as 150nm—a capability important for eventual moves to Hybrid Bonding.

While Jefferies is still waiting for "the HBM dust to settle" to gain confidence in double-digit growth next year, the firm believes continued strength in other business segments should help Camtek bridge any potential gaps. With a return on equity of 25% and 12 additional key insights available on InvestingPro, including detailed valuation metrics and growth projections, investors can access comprehensive analysis through the Pro Research Report.

In other recent news, Camtek Ltd . reported record revenue for the second quarter, exceeding analyst expectations. The company’s revenue reached $123.3 million, surpassing the consensus forecast of $121.57 million and marking a 20% increase from the same quarter last year. Camtek’s adjusted earnings per share for the quarter were $0.79, aligning with analyst estimates. The firm achieved a non-GAAP gross margin of 51.9% and a non-GAAP operating income of $37.4 million, which is a 21% increase compared to the previous year. Despite these strong financial results, the company’s shares experienced a decline, possibly due to a modest sequential growth outlook. These developments highlight the recent performance of Camtek in the semiconductor inspection equipment sector.

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