Take off with AXT Inc. (AXTI): Get ready for trading

AXT Inc. (NASDAQ: AXTI) stock jumped 24.93% on Friday to $8.77 against a previous-day closing price of $7.02. With 1.58 million shares changed hands, the volume of the stock remained heavier than its average volume of 0.15 million shares. During the session, the Semiconductor Equipment & Materials company that operates in wider Technology sector, reached to the highest price of $8.85 whereas the lowest price it dropped to was $7.86. The 52-week range on AXTI shows that it touched its highest point at $10.52 and its lowest point at $4.97 during that stretch. It currently has a 1-year price target of $12.33. Beta for the stock currently stands at 1.97.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of AXTI was up-trending over the past week, with a rise of 31.48%, but this was up by 51.73% over a month. Three-month performance surged to 47.39% while six-month performance rose 29.73%. The stock lost -13.60% in the past year, while it has lost -0.45% so far this year. A look at the trailing 12-month EPS for AXTI yields 0.33 with Next year EPS estimates of 0.61. For the next quarter, that number is 0.10. This implies an EPS growth rate of 351.70% for this year and 48.66% for next year. EPS is expected to grow by 10.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 15.20%.

Float and Shares Shorts:

At present, 41.87 million AXTI shares are outstanding with a float of 40.20 million shares on hand for trading. On Jul 14, 2022, short shares totaled 0.95 million, which was 2.22% higher than short shares on Jun 14, 2022. In addition to Dr. Morris S. Young Ph.D. as the firm’s Co-Founder, CEO & Chairman, Mr. Gary L. Fischer serves as its CFO, VP & Corp. Sec.

Institutional Ownership:

Through their ownership of 54.52% of AXTI’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 8.34% of AXTI, in contrast to 28.57% held by mutual funds. Shares owned by individuals account for 25.21%. As the largest shareholder in AXTI with 6.98% of the stake, Dimensional Fund Advisors LP holds 2,999,114 shares worth 2,999,114. A second-largest stockholder of AXTI, BlackRock Fund Advisors, holds 2,419,042 shares, controlling over 5.63% of the firm’s shares. Wellington Management Co. LLP is the third largest shareholder in AXTI, holding 2,098,283 shares or 4.89% stake. With a 2.70% stake in AXTI, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 1,158,144 shares are owned by the mutual fund manager. The Needham Small Cap Growth Fund, which owns about 2.56% of AXTI stock, is the second-largest Mutual Fund holder. It holds 1,100,000 shares valued at 6.45 million. iShares Russell 2000 ETF holds 2.05% of the stake in AXTI, owning 879,585 shares worth 5.15 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Jun 29, 2022, AXTI reported revenue of $39.65M and operating income of $3.70M. Over the past year, revenue came in at $145.70M while operating income stood at $13.04M. It generated $3.17M net income for the quarter, which came to $14.31M over the last twelve months. The EBITDA in the recently reported quarter was $6.80M and diluted EPS was $0.07. EBITDA for the full year was $22.18M.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for AXTI since 6 analysts follow the stock currently. There are 4 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 1 believe that the stock is worth HOLDING, 1 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With AXTI analysts setting a high price target of $20.00 and a low target of $8.00, the average target price over the next 12 months is $12.33. Based on these targets, AXTI could surge 128.05% to reach the target high and fall by -8.78% to reach the target low. Reaching the average price target will result in a growth of 40.59% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. AXTI will report FY 2022 earnings on 02/22/2023. Analysts have provided yearly estimates in a range of $0.56 being high and $0.46 being low. For AXTI, this leads to a yearly average estimate of $0.49. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. AXT Inc. surprised analysts by $0.05 when it reported $0.13 EPS against a consensus estimate of $0.08. The surprise factor in the prior quarter was $0.01. Based on analyst estimates, the high estimate for the next quarter is $0.13 and the low estimate is $0.13. The average estimate for the next quarter is thus $0.13.



Summary of Insider Activity:

Insiders traded AXTI stock several times over the past three months with 3 Buys and 0 Sells. In these transactions, 45,714 shares were bought while 0 shares were sold. The number of buy transactions has increased to 10 while that of sell transactions has risen to 2 over the past year. The total number of shares bought during that period was 385,792 while 40,000 shares were sold.

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