GlobalFoundries (GFS): Assessing Valuation After Jefferies Downgrade and Evolving Semiconductor Market Trends

GlobalFoundries (GFS) caught investors’ attention after being downgraded by a major Wall Street firm. The move highlights ongoing industry challenges, including muted demand and rising competition. At the same time, re-shoring trends support its long-term story.

See our latest analysis for GlobalFoundries.

After a rocky stretch marked by competitive pressures and cautious analyst sentiment, GlobalFoundries shares have slipped, with a 1-year total shareholder return of -12.2% and an even steeper 3-year figure of -37.7%. With momentum fading, investors are weighing the long-term benefits of re-shoring against near-term uncertainty and recent price declines.

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With analyst downgrades, near-term challenges, and a small discount to target price, the big question lingers: is GlobalFoundries currently undervalued, or is the market already factoring in its future potential?

Most Popular Narrative: 10.4% Undervalued

GlobalFoundries' most active narrative assigns a fair value about 10% higher than its last close of $35.32. This highlights how revenue projections and margin recovery could influence future valuation. With the target price set above the market, debate continues over whether the company’s scale-up justifies this optimism.

The company's focus on differentiated technologies (such as FD-SOI, RF, and power management platforms) and recent MIPS acquisition strengthens its value proposition in edge AI, automotive, and data center markets. This deepens customer partnerships and enables premium pricing, which is likely to drive sustained improvements in revenue visibility and margin stability.

Read the complete narrative.

Want to see what’s powering this bold price target? The secret sauce combines surging profit forecasts with a future earnings multiple you might not expect. Discover which aggressive financial moves and margin bets are fueling a valuation that could redefine GlobalFoundries’ place in the semiconductor world.

Result: Fair Value of $39.43 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, challenges such as limited exposure to advanced process nodes and ongoing pricing pressure in mobile chips could undermine GlobalFoundries' growth outlook.

Find out about the key risks to this GlobalFoundries narrative.

Build Your Own GlobalFoundries Narrative

If you’d like to dig into the numbers personally or see the story from a different angle, you can shape your own perspective in just a few minutes. Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding GlobalFoundries.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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