AXTI - AXT: Strong Outlook As Business Recovery Is Picking Up Steam - Buy

2024-05-07 11:04:29 ET

Summary

• Semiconductor substrate provider AXT, Inc. reported Q1/2024 results in line with its April 8 preannouncement and provided Q2 guidance well ahead of expectations.
• The company's substrate business continues to recover across all major product lines, with some AI-related demand contributing to a 50% sequential increase in indium phosphide sales.
• Management expects the company to reach breakeven levels by the end of this year or early next year.
• The company is considering monetizing some of its holdings in a number of Chinese raw materials providers.
• Risk/reward is looking increasingly favorable for speculative investors, with the business recovering across the board and a number of potential near- and medium-term catalysts. Reiterating "Buy" rating with a near-term price target of $5.30.

Note:

I have covered AXT, Inc. or "AXT" (NASDAQ: AXTI ) previously, so investors should view this as an update to my earlier article on the company. ...

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