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On Tuesday, Oak Ridge Financial initiated coverage on inTEST Corporation (NYSE:INTT), a company specializing in thermal management and semiconductor testing solutions, with a Buy rating and a price target of $14.00. The new rating comes with an analysis of the company's efforts to diversify its business and reduce its reliance on the semiconductor industry. The target represents significant upside potential from the current price of $8.98, with InvestingPro data showing analyst targets ranging from $10 to $16.
The research firm pointed out that despite inTEST's strategic moves to diversify, the market has yet to adjust the company's valuation to reflect these changes. According to Oak Ridge Financial, inTEST has been unfairly categorized with the broader front-end semiconductor industry, which has overshadowed its individual progress. InvestingPro data reveals strong fundamentals, with a healthy current ratio of 2.26 and moderate debt levels, suggesting financial stability despite market perception.
Oak Ridge Financial anticipates a positive shift in order and revenue trends for inTEST later in the year. The firm expects these changes to correct the current underperformance of inTEST's stock. The analyst predicts a reversion to the mean, suggesting that inTEST's stock price will align more closely with its intrinsic value and provide returns to shareholders who recognize the company's current market valuation.
The price target of $14.00 implies a significant potential upside from the company's recent trading price. inTEST Corporation's stock performance will be closely watched by investors as the market anticipates the forecasted upward trends in orders and revenues later in the year.
In other recent news, inTEST Corporation has released its third quarter financial results for 2024, revealing revenues of $30 million, significantly bolstered by its recent acquisition of Alfamation. Despite a slump in semiconductor sales, the firm saw increased orders from automotive EV, defense aerospace, and industrial markets. Adjustments have been made to the company's full-year revenue outlook, with a focus on innovation and potential acquisitions.
Alfamation's contribution to the overall revenue was $5.4 million, with orders totaling $28 million. The company has projected its Q4 revenue to be between $34 million and $37 million. However, inTEST has reduced its workforce by 10% to align with market conditions. These are the recent developments that have taken place within the company.
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