Axcelis Technologies is the IBD Stock Of The Day as the semiconductor equipment supplier shows strength after its fourth-quarter earnings report. ACLS stock now is looking for support at a key level during the current market turmoil.
According to IBD MarketSmith charts, ACLS stock has formed a cup-with-handle base with a buy point of 75.10. For the last three trading sessions, ACLS stock has been testing support near its 50-day moving average line.
Also, its relative strength line is near recent highs as it outperforms the S&P 500 index, a positive sign.
On the stock market today, ACLS stock rose at first but succumbed to a down market and lost 2.4% to 63.84. On Jan. 4, it hit a 21-year high of 77.60 before pulling back in the stock market correction.
Axcelis Crushes Fourth-Quarter Targets
Axcelis specializes in ion implantation systems, one of the most critical steps in the process of manufacturing integrated circuits.
On Feb. 7, the Beverly, Mass.-based company delivered better-than-expected results for the fourth quarter. It earned $1.05 a share, up 144% year over year, on sales of $205.7 million, up 68%. Analysts had expected Axcelis earnings of 84 cents a share on sales of $190.1 million, FactSet said.
For 2021, Axcelis earned $2.88 a share, up 97%, on sales of $662.4 million, up 40%.
"2021 was an outstanding year for Axcelis," Chief Executive Mary Puma said in a news release. "We surpassed our $650 million revenue model two years ahead of plan."
"It is an exciting time with unprecedented growth in the industry and robust customer demand for our products in all market segments and geographies," she went on to say. "As a result of the strength of demand in this environment, we expect to achieve a quarterly revenue run rate supporting our $850 million revenue model this year."
ACLS Stock Ranks First In Industry Group
Needham analyst Quinn Bolton said the Axcelis earnings report was "impressive," especially given supply constraints.
"We believe investors should be encouraged by the results and outlook as bookings hit a record and orders/visibility are extending into 2023," Bolton said in a note to clients. He rates ACLS stock as buy with a price target of 76.
D.A. Davidson analyst Thomas Diffely reiterated his buy rating on ACLS stock after the earnings report. He also raised his price target to 90 from 85.
According to IBD Stock Checkup, ACLS stock ranks first out of 31 stocks in IBD's semiconductor equipment industry group. It has a best-possible IBD Composite Rating of 99. The Composite Rating scores a stock's key growth metrics against all other stocks regardless of industry group.
The chip gear group ranks No. 54 out of 197 industry groups that IBD tracks. IBD trading guidelines recommend focusing on top-rated stocks in leading industry groups.
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