TD Cowen analyst Krish Sankar has reiterated their bullish stance on SKYT stock, giving a Buy rating today.
Krish Sankar has given his Buy rating due to a combination of factors that reflect a positive outlook for SkyWater Technology. The company reported better-than-expected financial results for the December quarter, driven by improved gross margins and strategic tool sales. Additionally, SkyWater’s acquisition of Fab 25 from Infineon is seen as a significant move that not only increases production capacity but also reduces the risk associated with relying on a single manufacturing facility.
SkyWater’s future prospects are bolstered by expected growth in both Advanced Technology Services and Wafer Services, with a return to profitability anticipated in 2025. The company’s focus on expanding its core revenue through investments in aerospace, defense, and quantum computing projects, alongside a recovery in wafer services, is expected to drive revenue growth. Furthermore, the acquisition of Fab 25 is projected to enhance revenue through a secured supply agreement, despite initial gross margin dilution. These strategic initiatives underpin Sankar’s confidence in SkyWater’s potential, leading to the Buy rating.
According to TipRanks, Sankar is a 5-star analyst with an average return of 18.7% and a 60.74% success rate. Sankar covers the Technology sector, focusing on stocks such as Pure Storage, Lam Research, and Micron.
In another report released today, Needham also maintained a Buy rating on the stock with a $12.00 price target.
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