Our Stock of the Week is Ichor Holdings (ICHR). ICHR designs and manufacturers critical fluid delivery subsystems that is used in equipment for the production of semiconductor equipment.
In the December quarter the company earned $0.34 per share versus $0.01 in the same quarter the year before. Revenues grew a very hefty 104%. For the 2017 calendar year, analysts anticipate earnings will grow 102% to $1.78 and will grow another 10% in the following year.
Despite this impressive growth, the stock trades with a trailing PE of 21. Although this business is cyclical and typically doesn’t demand high multiples this still looks like a very attractive valuation.
The stock IPO’d at $9 in early December 2016 and has stair stepped higher on the attractive numbers. It is currently in a trading range between $17 and $19 and we are looking for a break and a close over $19 to trigger the next step up.
The stock trades thin and can be volatile. As always we would not chase the open on Monday but will look for a strong close on good volume to signal that momentum is favorable. We’d likely place stops around the $18 level. This stock needs overall market cooperation to move strongly but it has good fundamental and technical characteristics.
This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength, and will buy or sell at any time for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees and affiliates of Shark Investing, Inc. and/or principals, employees and affiliates of Shark Asset Management, Inc. ("SAMI"), directly or indirectly, controlled investment and/or trading accounts containing positions in CALA. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.
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