D-Wave Quantum falls nearly 3% as earnings miss overshadows revenue beat
On Tuesday, Fabrinet (NYSE:FN) saw its price target increased to $250 from the previous $230 by Rosenblatt analysts. The firm reaffirmed its Buy rating on the stock, suggesting confidence in the company’s future performance. The company, currently trading at $220.90 with a market capitalization of $7.91 billion, has demonstrated strong financial health, earning an "Excellent" overall score of 3.8 on InvestingPro’s comprehensive assessment framework.
The revision in the price target comes as Rosenblatt analysts express a positive outlook on Fabrinet’s market share gains across various end-markets and commend the company’s consistent management execution. They project that both Datacom and Telecom (BCBA:TECO2m) revenues are set to grow quarter over quarter in the fourth quarter of 2025. This growth trajectory aligns with the company’s impressive 14.83% revenue growth over the last twelve months. InvestingPro data reveals 12 additional key insights about Fabrinet’s performance and potential, available to subscribers.
Analysts at Rosenblatt are optimistic about the company’s upcoming fiscal year, citing several catalysts that could drive growth for Fabrinet in FY26. Among these are the new deal with Amazon (NASDAQ:AMZN) for advanced manufacturing services, the incremental growth expected from the recent win with Ciena (NYSE:CIEN), and an acceleration in Datacom related to 1.6T technologies. The company’s strong market position is supported by robust fundamentals, including a healthy current ratio of 3.32 and zero debt-to-equity ratio, indicating solid financial stability.
The new price target is based on a 22.5 times multiple of the estimated earnings per share (EPS) for 2026, indicating a bullish stance on the company’s earnings potential over the next year. The analysts’ commentary underscores their belief in the company’s strategic moves and their potential to enhance Fabrinet’s financial metrics.
Fabrinet specializes in precision optical, electro-mechanical, and electronic manufacturing services, primarily serving the Datacom and Telecom sectors. The company’s ability to secure significant deals and expand its market presence has been a key factor in the analysts’ positive rating.
In other recent news, Fabrinet reported third-quarter earnings that missed analyst expectations, although revenue exceeded estimates. The company posted adjusted earnings per share of $2.52, slightly below the consensus forecast of $2.54, while revenue reached $871.8 million, surpassing the anticipated $858.3 million and marking a 19.2% increase year-over-year. Despite the revenue beat, higher costs impacted profitability, leading to investor disappointment. Looking ahead, Fabrinet expects fourth-quarter revenue between $860 million and $900 million, with adjusted EPS projected between $2.55 and $2.70, compared to analyst expectations of $2.65.
In a separate development, JPMorgan raised its price target for Fabrinet to $235 from $220, maintaining a Neutral rating. This adjustment comes after Fabrinet’s recent financial results, which exceeded expectations. The company experienced a surge in Telecom revenues, driven by demand for direct current interconnect and new contracts, although Datacom revenues declined due to a shift to next-generation products and potential market share changes. Fabrinet anticipates quarter-over-quarter revenue growth in Datacom for the fourth fiscal quarter of 2025, supported by contracts with Ciena and Amazon. JPMorgan’s revised price target reflects a higher target multiple of 19 times, as Fabrinet progresses with its Datacom revenue.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.