Is Camtek a Winner in the Semiconductor Equipment Industry?

NASDAQ: CAMT | Camtek Ltd. - Ordinary Shares News, Ratings, and Charts

CAMT – Camtek (CAMT) is an integral part of the semiconductor industry as it makes equipment for inspecting production processes. The stock has been a big gainer over the past month as new investments in semiconductor capacity are being made. Patrick Ryan breaks down whether the stock remains a buy.

Camtek Limited (CAMT) designs, makes, and markets automated systems for optical inspection. CAMT’s inspection systems are helpful in the context of improving production processes as well as yield for businesses that make printed circuit boards, those in the high-density substrate sector, and those that make and package semiconductors.
 

Rewind time merely one month ago and CAMT was trading at $30. The stock is now trading around $40. This means CAMT is up more than 34% in a single month. CAMT’s year-to-date performance is even better. The stock was trading around $22 at this time last year. CAMT has gradually increased throughout the prior 12 months. Though the stock dipped back down to the mid-$20s in May, it bounced right back, moving up to the high $30s within weeks.
 
Where does CAMT go from here? Let’s take a closer look at the stock to get a sense of whether it is likely to move even higher or give way to profit-taking.
 
CAMT Points of Note

CAMT has a net profit of just under 18% across the prior 12 months. The company’s forward P/E ratio is 27.74. This is a slightly elevated forward P/E ratio though it is not absurdly high. The stock’s forward P/E ratio is also high as a result of its close proximity to its 52-week high of $40.47. CAMT’s 52-week low is $11.79. The stock has a beta of 1.67 so it won’t prove egregiously volatile should the market significantly fluctuate in the quarters ahead.

CAMT’s price returns are in the green across the board, meaning the company’s stock has generated a positive price return in recent months, years, and even across the past half-decade. CAMT had a 2020 price return of 102%. The stock’s year-to-date price return is 82%. CAMT has an impressive three-year price return of 383%. The stock’s five-year price return is even better, coming in at a whopping 1,999%.

Continue researching CAMT and you might be slightly taken aback by the lack of news pertaining to the business. There is certainly plenty of information detailing CAMT’s previous quarterly earnings yet there is not much else available for public consumption. This lack of information is a bit concerning though it should not be construed as a red flag that indicates CAMT is unworthy of your investing dollars.

CAMT POWR Ratings

CAMT has a POWR Rating of B. This means the stock is a Buy. CAMT has B grades in the Quality, Sentiment, Momentum, and Growth components of the POWR Ratings. If you are curious as to how CAMT fares in the rest of the POWR Ratings components such as Stability and Value, you can find out by clicking here.

Of the nearly 100 stocks in the Semiconductor & Wireless Chip category, CAMT is ranked 25th. This segment has an overarching POWR Rating grade of B. You can learn more about the stocks in this space by clicking here.

CAMT According to the Analysts

The analysts are CAMT believers. Of the four analysts who have issued recommendations on the stock, three consider it a Buy and one considers it a Hold. The stock’s average price target has increased by $5.50 in the past 31 weeks.

Is CAMT a Winner?

Indeed, CAMT is a winner. The stock is a POWR Ratings success with an overall Buy rating. The stock has B grades in the majority of the POWR Rating components, meaning it is that much more worthy of your investing dollars than stocks with average or below average POWR Rating components. Add in the fact that CAMT is ranked in the top quarter of the stocks in its space and you should feel even more comfortable adding it to your portfolio. Scoop up CAMT today and you will likely be happy with the return in the months and years ahead.


CAMT shares were trading at $38.43 per share on Friday morning, up $0.27 (+0.71%). Year-to-date, CAMT has gained 75.40%, versus a 13.61% rise in the benchmark S&P 500 index during the same period.


About the Author: Patrick Ryan


Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...


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