FormFactor helps semiconductor manufacturers test the integrated circuits (ICs) that power consumer mobile devices, as well as computing, automotive and other applications. The company was founded in 1993 and is based in Livermore, California.
FORM Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for FORM, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Formfactor Inc ranked in the 73th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 328% on a DCF basis. The most interesting components of our discounted cash flow analysis for Formfactor Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 27.66 -- which is good for besting 85.92% of its peer stocks (US stocks in the Technology sector with positive cash flow).
The business' balance sheet suggests that 3% of the company's capital is sourced from debt; this is greater than merely 10.46% of the free cash flow producing stocks we're observing.
FORM's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 56.64% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as FORM, try GSB, TTMI, TSM, AMZN, and CIEN.