DB:FMF

Stock Analysis Report

Executive Summary

FormFactor, Inc. designs, manufactures, and sells probe cards, analytical probes, probe stations, integrated measurement systems, and thermal sub-systems, as well as provides related services.

Rewards

Earnings are forecast to grow 24.71% per year

Risk Analysis

Profit margins (6.7%) are lower than last year (19.5%)

Shareholders have been diluted in the past year



Snowflake Analysis

Excellent balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has FormFactor's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FMF has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

6.8%

FMF

3.8%

DE Semiconductor

1.7%

DE Market


1 Year Return

79.1%

FMF

16.7%

DE Semiconductor

15.0%

DE Market

Return vs Industry: FMF exceeded the German Semiconductor industry which returned 16.7% over the past year.

Return vs Market: FMF exceeded the German Market which returned 15% over the past year.


Shareholder returns

FMFIndustryMarket
7 Day6.8%3.8%1.7%
30 Day3.3%4.9%0.8%
90 Day20.2%14.3%3.7%
1 Year79.1%79.1%18.6%16.7%18.5%15.0%
3 Year131.1%131.1%38.5%35.2%17.1%6.9%
5 Year216.3%216.3%104.9%96.4%24.3%7.3%

Price Volatility Vs. Market

How volatile is FormFactor's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is FormFactor undervalued compared to its fair value and its price relative to the market?

51.25x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: FMF (€25) is trading above our estimate of fair value (€14.21)

Significantly Below Fair Value: FMF is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: FMF is poor value based on its PE Ratio (51.3x) compared to the Semiconductor industry average (28x).

PE vs Market: FMF is poor value based on its PE Ratio (51.3x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: FMF is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: FMF is overvalued based on its PB Ratio (3.2x) compared to the DE Semiconductor industry average (2.4x).


Next Steps

Future Growth

How is FormFactor forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

24.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FMF's forecast earnings growth (24.7% per year) is above the savings rate (-0.4%).

Earnings vs Market: FMF's earnings (24.7% per year) are forecast to grow faster than the German market (13.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FMF's revenue (5.3% per year) is forecast to grow faster than the German market (5% per year).

High Growth Revenue: FMF's revenue (5.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FMF's Return on Equity is forecast to be low in 3 years time (10.1%).


Next Steps

Past Performance

How has FormFactor performed over the past 5 years?

65.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FMF has high quality earnings.

Growing Profit Margin: FMF's current net profit margins (6.7%) are lower than last year (19.5%).


Past Earnings Growth Analysis

Earnings Trend: FMF has become profitable over the past 5 years, growing earnings by 65.1% per year.

Accelerating Growth: FMF's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FMF had negative earnings growth (-61.9%) over the past year, making it difficult to compare to the Semiconductor industry average (-17.8%).


Return on Equity

High ROE: FMF's Return on Equity (6.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is FormFactor's financial position?


Financial Position Analysis

Short Term Liabilities: FMF's short term assets ($419.0M) exceed its short term liabilities ($136.6M).

Long Term Liabilities: FMF's short term assets ($419.0M) exceed its long term liabilities ($62.3M).


Debt to Equity History and Analysis

Debt Level: FMF's debt to equity ratio (9.1%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if FMF's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: FMF's debt is well covered by operating cash flow (207%).

Interest Coverage: FMF earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: FMF has a high level of physical assets or inventory.

Debt Coverage by Assets: FMF's debt is covered by short term assets (assets are 7.2x debt).


Next Steps

Dividend

What is FormFactor's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.3%markettop25%3.6%industryaverage1.1%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate FMF's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate FMF's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FMF's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FMF's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FMF's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

Mike Slessor (49yo)

5.2yrs

Tenure

US$3,684,365

Compensation

Dr. Michael D. Slessor, also known as Mike, has been the Chief Executive Officer at FormFactor Inc. since December 28, 2014 and served as its President from October 2013 till December 2014. Dr. Slessor ser ...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD3.68M) is above average for companies of similar size in the German market ($USD1.49M).

Compensation vs Earnings: Mike's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Michael Slessor
CEO & Director5.2yrsUS$3.68m0.44% $8.3m
Shai Shahar
Chief Financial Officer1.9yrsUS$1.91m0.013% $249.3k
Jarek Kister
CTO and Senior VP of Technology R&D6.1yrsno datano data
Stan Finkelstein
Head of Investor Relations0yrsno datano data
Jason Cohen
VP, General Counsel & Secretary4.5yrsno datano data
Amy Leong
Chief Marketing Officer and Senior VP of Mergers & Acquisitions2.8yrsno datano data
Robert Selley
Senior Vice President of Worldwide Sales & Service2.8yrsno datano data
Tim Mueller
Vice President of Global Human Resources3.6yrsno datano data
Matt Losey
Senior VP & GM of Probes Business Unit2.9yrsno datano data

3.3yrs

Average Tenure

49yo

Average Age

Experienced Management: FMF's management team is considered experienced (3.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Michael Slessor
CEO & Director5.2yrsUS$3.68m0.44% $8.3m
Lothar Maier
Independent Director13.3yrsUS$178.12k0.11% $2.2m
Edward Rogas
Independent Director9.3yrsUS$177.00k0.051% $967.1k
Thomas Dennis
Independent Chairman6.3yrsUS$187.00k0.048% $892.9k
Michael Zellner
Director Emeritus0yrsUS$189.00k0.055% $1.0m
Raymond Link
Independent Director3.7yrsUS$176.97k0.068% $1.3m
Richard DeLateur
Director Emeritus0yrsUS$187.40k0.033% $620.1k
Kelley Steven-Waiss
Independent Director4.5yrsUS$174.50k0.017% $320.0k
Sheri Rhodes
Director0.2yrsno datano data
Rebeca Obregon-Jimenez
Director0.4yrsno datano data

5.4yrs

Average Tenure

63yo

Average Age

Experienced Board: FMF's board of directors are considered experienced (5.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: FMF insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.1%.


Top Shareholders

Company Information

FormFactor, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: FormFactor, Inc.
  • Ticker: FMF
  • Exchange: DB
  • Founded: 1993
  • Industry: Semiconductor Equipment
  • Sector: Semiconductors
  • Market Cap: US$2.037b
  • Listing Market Cap: US$1.879b
  • Shares outstanding: 75.76m
  • Website: https://www.formfactor.com

Number of Employees


Location

  • FormFactor, Inc.
  • 7005 Southfront Road
  • Livermore
  • California
  • 94551
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FORMNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJun 2003
FMFDB (Deutsche Boerse AG)YesCommon StockDEEURJun 2003

Biography

FormFactor, Inc. designs, manufactures, and sells probe cards, analytical probes, probe stations, integrated measurement systems, and thermal sub-systems, as well as provides related services. It operates in two segments, Probe Cards and Systems. The company offers probe cards that are used to test various semiconductor device types, including system on a chip products, mobile application processors, microprocessors, microcontrollers, and graphic processors, as well as radio frequency, analog, mixed signal, image sensor, electro-optical, dynamic random access memory, NAND flash memory, and NOR flash memory devices; and analytical probes, which are used for a range of applications, including device characterization, electrical simulation model development, failure analysis, and prototype design debugging for universities, research institutions, semiconductor integrated device manufacturers, semiconductor foundries, and fabless semiconductor companies. It also provides probing systems for semiconductor design engineers to capture and analyze accurate data; integrated measurement systems that include test instrumentation, probe, cabling configurations, and software to enable fast, accurate, and on-wafer data collection for complex application and measurement needs; thermal subsystems that produce thermal chucks and other test systems used in probe stations. In addition, the company offers on-site probe card maintenance and service training, seminars, and telephone support services. FormFactor, Inc. markets and sells its products through direct sales force, manufacturers’ representatives, and distributors in the United States, Taiwan, South Korea, China, Japan, Europe, the Asia-Pacific, and internationally. The company was founded in 1993 and is headquartered in Livermore, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/16 20:50
End of Day Share Price2020/02/14 00:00
Earnings2019/12/28
Annual Earnings2019/12/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.