TTMI: Data Center And AI Demand Will Drive Measured Upside Into 2026

Analysts have increased our TTM Technologies fair value estimate to $77.50 from $76.00, reflecting increased conviction in accelerating data center and AI driven revenue growth, improving margins, and the companys expanded high end PCB capacity into 2026.

Analyst Commentary

Bullish analysts are broadly constructive on TTM Technologies, citing stronger than expected execution, rising confidence in AI driven demand, and expanding high end PCB capacity as key supports for the higher valuation framework into 2026.

Bullish Takeaways

• Multiple price target increases, into the high 70s per share, reflect rising conviction that accelerating Data Center Computing and AI related revenue can support faster top line growth and multiple expansion.
• Recent beat and raise quarters, with guidance above consensus, are reinforcing the view that management is executing well on demand, mix, pricing, and operational discipline, supporting margin upside versus prior expectations.
• Capacity additions at the most advanced PCB facilities, particularly in China, are seen as a strategic advantage that positions TTM Technologies to capture incremental AI and high speed networking demand in 2026 and beyond.
• Improving yield trends at newer facilities such as Penang, even if not essential to the DCC growth trajectory, are viewed as an additional lever for long term profitability and return on invested capital.

Bearish Takeaways

• Even bullish analysts acknowledge that the higher valuation increasingly incorporates expectations for strong AI and data center growth through 2026, leaving less room for error if industry demand or customer spending slows.
• The heavy reliance on high end PCB capacity expansions in China introduces execution and utilization risk, particularly if macro uncertainty or export restrictions impact customer ordering patterns.
• While near term margins are trending higher, they remain sensitive to product mix and pricing discipline, and any reversal in favorable mix trends could pressure earnings and challenge the elevated price targets.

What's in the News

• Issued fourth quarter 2025 guidance calling for net sales between $730 million and $770 million, signaling continued top line momentum into year end (Key Developments).
• Announced new ultra small RF crossover and broadband splitter components targeting high frequency Telecom, Test and Measurement, and COTS Mil Aero applications, reinforcing its innovation pipeline in RF and specialty components (Key Developments).
• Reported no share repurchases under the current buyback program between July 1, 2025 and September 29, 2025, effectively leaving the authorization unused during the period (Key Developments).

Valuation Changes

• The Fair Value Estimate has risen slightly to $77.50 from $76.00, reflecting modestly higher confidence in long term fundamentals.
• The Discount Rate has fallen slightly to 8.78 percent from 8.82 percent, modestly increasing the present value of future cash flows.
• The Revenue Growth assumption has risen slightly to about 8.11 percent from about 7.80 percent, indicating a marginally stronger top line outlook.
• The Net Profit Margin assumption has increased slightly to about 8.59 percent from about 8.49 percent, implying small anticipated efficiency and profitability gains.
• The future P/E multiple has edged down marginally to 35.3 times from 35.4 times, suggesting largely unchanged longer term valuation expectations.