Jim Hin Kwong Au, an analyst from DBS, maintained the Buy rating on GlobalFoundries Inc (GFS – Research Report). The associated price target is $66.00.
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Jim Hin Kwong Au has given his Buy rating due to a combination of factors that paint a promising outlook for GlobalFoundries Inc. The company’s long-term agreements, particularly with Qualcomm, are pivotal in stabilizing revenue streams by mitigating the risks of capacity oversupply and fluctuating demand. These agreements cover a substantial portion of GlobalFoundries’ capacity and revenue, offering a solid financial foundation.
Additionally, the growth prospects are bolstered by strategic partnerships and expansions in Europe, such as the joint venture with STMicroelectronics in France, expected to significantly increase production capacity. The company’s expansion initiatives are further supported by funding opportunities from the US and European CHIPS Act, providing financial incentives for technological advancements and capacity growth. Despite challenges in consumer electronics demand, GlobalFoundries’ focus on diverse markets and strong governmental support positions it well for long-term growth, justifying the Buy rating with a target price of $66.00 per share.
In another report released yesterday, Evercore ISI also reiterated a Buy rating on the stock with a $55.00 price target.