VICR: Future Returns Will Lag As Modest Buybacks Fail To Offset Risk

Narrative Update on Vicor

Analysts have modestly raised their price target on Vicor to 86.67 dollars from 86.67 dollars. This reflects unchanged fair value expectations, along with slightly higher discount rate and future P/E assumptions that fine tune their longer term risk and valuation outlook.

What's in the News

• Completed share repurchase program initiated July 31, 2024, buying back a total of 762,524 shares, representing 1.69% of outstanding shares for 33.81 million dollars (company buyback filing).
• Repurchased 336,001 shares between July 1, 2025 and September 30, 2025, equal to 0.75% of outstanding shares, for 15.59 million dollars as the final tranche of the program (company buyback filing).
• Ongoing capital return via buybacks reflects management’s stated confidence in the company’s long-term prospects and balance sheet strength, and modestly reduces the share count for remaining investors (company commentary inferred from buyback activity).

Valuation Changes

• The fair value estimate remains unchanged at 86.67 dollars per share, indicating stable long term intrinsic value expectations.
• The discount rate has risen slightly from 8.99 percent to 9.11 percent, reflecting a modestly higher perceived risk profile or cost of capital.
• Revenue growth assumptions are effectively unchanged, holding around 8.38 percent annually and signaling steady expectations for top line expansion.
• The net profit margin forecast remains stable at approximately 20.38 percent, indicating no material change in long term profitability assumptions.
• The future P/E has risen slightly from 42.10 times to 42.24 times, suggesting a marginally higher valuation multiple applied to Vicor’s projected earnings.