Trading Nvidia earnings report? These are the entry and exit levels to watch for
Investing.com - JPMorgan upgraded Fabrinet (NYSE:FN) from Neutral to Overweight on Monday, while raising its price target to $345.00 from $318.00. The company, currently valued at $10.53 billion, has demonstrated strong financial health with an overall score of "GREAT" according to InvestingPro analysis.
The upgrade comes after a recent pullback in Fabrinet shares following the company’s earnings report, which JPMorgan attributes to disappointment relative to elevated near-term expectations and constraints due to supply shortages.
The investment bank noted that Fabrinet shares are now trading at approximately 24x next-twelve-months consensus earnings, significantly lower than the nearly 30x multiple before the latest earnings report.
JPMorgan highlighted several growth catalysts for Fabrinet, including program ramps with prominent customers such as Nvidia’s 1.6T opportunity (forecasted as a $1.5 billion market in 2026), Ciena’s modem opportunity expected to generate material revenue in 2026, and Amazon’s HPC opportunity representing a sizable market.
The firm also pointed to solid momentum in Telecom, with high-growth DCI revenues already accounting for more than 10% of total revenue, and management considering accelerating construction at Building 10, which would add $2.4 billion of revenue capacity to the current $4.2 billion.
In other recent news, Fabrinet reported its fourth-quarter 2025 earnings, slightly surpassing analysts’ expectations with an earnings per share (EPS) of $2.65 compared to the projected $2.64. The company’s revenue also exceeded forecasts, reaching $910 million against an anticipated $883 million. This better-than-expected performance led Barclays to raise its price target for Fabrinet to $329, citing strength in optical demand, while maintaining an Equalweight rating. Additionally, a Raymond James analysis suggested favorable conditions for Fabrinet’s major clients, including Cisco, which saw a 59% sales increase year-over-year in fiscal year 2025. The report noted the strength in ZR/ZR+ technology as a positive indicator for Cisco’s performance. These developments underscore a positive outlook for Fabrinet and its associated companies.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.