Needham & Company Upgrades Fabrinet (FN) to Buy
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Rating Summary:
8 Buy, 4 Hold, 1 Sell
Rating Trend: Down
Today's Overall Ratings:
Up: 11 | Down: 13 | New: 18
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Needham & Company upgraded Fabrinet (NYSE: FN) from Hold to Buy with a price target of $24.00.
Analyst Alex Henderson commented, "We are becoming more constructive on FN shares. First, the optical markets particularly in the Telecom arena appear to be gradually accelerating and moving toward a period of potentially robust growth. Second, our concern, about the increased costs associated with the building of a prototype line facility in California at an investment of over $40 million, has now been absorbed and the on-going costs are well modeled and highly knowable. Third, the capacity utilization at Fabrinet’s facilities is tightening which should help Gross Margins incrementally improve. Finally, FN’s valuation looks relatively compelling at just 6.8x EV/E and 0.5x EV/Sales on CY16 estimates. We think there is upside to our estimates and justification for a more constructive view on FN."
For an analyst ratings summary and ratings history on Fabrinet click here. For more ratings news on Fabrinet click here.
Shares of Fabrinet closed at $17.88 yesterday.
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