why NeoPhotonics Corporation [NPTN] is a Good Choice for Investors After New Price Target of $11.38

NeoPhotonics Corporation [NYSE: NPTN] traded at a low on 08/21/20, posting a -3.32 loss after which it closed the day’ session at $7.28. The company report on August 4, 2020 that NeoPhotonics Reports Second Quarter 2020 Financial Results.

NeoPhotonics Corporation (NYSE: NPTN), a leading developer of silicon photonics and advanced hybrid photonic integrated circuit-based lasers, modules and subsystems for bandwidth-intensive, high speed communications networks, today announced financial results for its second quarter ended June 30, 2020.

“The second quarter was another strong quarter, with revenue up 26% compared to last year and continued gross margin expansion to 32.5%. This was our fourth straight quarter of profitability. Non-GAAP EPS was 16 cents and GAAP EPS was 11 cents per share,” said Tim Jenks, Chairman and CEO of NeoPhotonics. “With increasing momentum in 400G and above product design wins across almost all of the major network equipment manufacturers globally, and with increasing momentum in 400ZR opportunities, we remain optimistic about the growth prospects for NeoPhotonics,” concluded Mr. Jenks.

The results of the trading session contributed to over 1483649 shares changing hands. Over the past one week, the price volatility of NeoPhotonics Corporation stands at 5.25% while the volatility over the past one month is 5.19%.

The market cap for NPTN stock reached $373.17 million, with 49.08 million shares outstanding and 46.57 million shares in the current float. Compared to the average trading volume of 1.13M shares, NPTN reached a trading volume of 1483649 in the most recent trading day, which is why market watchdogs consider the stock to be active.

What do top market gurus say about NeoPhotonics Corporation [NPTN]?

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for NPTN shares is $11.38 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on NPTN stock is a recommendation set at 2.40. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

B. Riley FBR have made an estimate for NeoPhotonics Corporation shares, keeping their opinion on the stock as Neutral, with their previous recommendation back on June 16, 2020. The new note on the price target was released on April 24, 2020, representing the official price target for NeoPhotonics Corporation stock. Previously, the target price had yet another raise to $11, while JP Morgan analysts kept a Overweight rating on NPTN stock.

The Average True Range (ATR) for NeoPhotonics Corporation is set at 0.44, with the Price to Sales ratio for NPTN stock in the period of the last 12 months amounting to 0.94. The Price to Book ratio for the last quarter was 1.99, with the Price to Cash per share for the same quarter was set at 1.99. Price to Free Cash Flow for NPTN in the course of the last twelve months was 7.66 with Quick ratio for the last quarter at 1.90.

How has NPTN stock performed recently?

NeoPhotonics Corporation [NPTN] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -11.54. With this latest performance, NPTN shares dropped by -15.74% in over the last four-week period, additionally plugging by 8.66% over the last 6 months – not to mention a rise of 15.56% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for NPTN stock in for the last two-week period is set at 34.66, with the RSI for the last a single of trading hit 28.43, and the three-weeks RSI is set at 38.00 for NeoPhotonics Corporation [NPTN]. The present Moving Average for the last 50 days of trading for this stock 8.61, while it was recorded at 7.75 for the last single week of trading, and 8.17 for the last 200 days.

NeoPhotonics Corporation [NPTN]: Deeper insight into the fundamentals

Operating Margin for any stock indicates how profitable investing would be, and NeoPhotonics Corporation [NPTN] shares currently have an operating margin of -4.26 and a Gross Margin at +24.86. NeoPhotonics Corporation’s Net Margin is presently recorded at -4.79.

Return on Total Capital for NPTN is now -6.91, given the latest momentum, and Return on Invested Capital for the company is -8.00. Return on Equity for this stock declined to -10.66, with Return on Assets sitting at -5.06. When it comes to the capital structure of this company, NeoPhotonics Corporation [NPTN] has a Total Debt to Total Equity ratio set at 38.02. Additionally, NPTN Total Debt to Total Capital is recorded at 27.55, with Total Debt to Total Assets ending up at 18.20. Long-Term Debt to Equity for the company is recorded at 34.82, with the Long-Term Debt to Total Capital now at 25.23.

Reflecting on the efficiency of the workforce at the company, NeoPhotonics Corporation [NPTN] managed to generate an average of -$10,104 per employee. Receivables Turnover for the company is 4.30 with a Total Asset Turnover recorded at a value of 1.06.NeoPhotonics Corporation’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.90 and a Current Ratio set at 2.30.

Earnings analysis for NeoPhotonics Corporation [NPTN]

With the latest financial reports released by the company, NeoPhotonics Corporation posted 0.11/share EPS, while the average EPS was predicted by analysts to be reported at 0.02/share. When compared, the two values demonstrate that the company surpassed the estimates by a Surprise Factor of 450.00%. The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for NPTN. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for NeoPhotonics Corporation go to 15.00%.

Insider trade positions for NeoPhotonics Corporation [NPTN]

There are presently around $325 million, or 91.30% of NPTN stock, in the hands of institutional investors. The top three institutional holders of NPTN stocks are: RUSSELL INVESTMENTS GROUP, LTD. with ownership of 4,179,499, which is approximately 19.39% of the company’s market cap and around 2.20% of the total institutional ownership; BLACKROCK INC., holding 3,368,451 shares of the stock with an approximate value of $24.52 million in NPTN stocks shares; and VANGUARD GROUP INC, currently with $22.73 million in NPTN stock with ownership of nearly 35.479% of the company’s market capitalization.

Positions in NeoPhotonics Corporation stocks held by institutional investors increased at the end of August and at the time of the August reporting period, where 118 institutional holders increased their position in NeoPhotonics Corporation [NYSE:NPTN] by around 10,245,416 shares. Additionally, 60 investors decreased positions by around 7,507,612 shares, while 11 investors held positions by with 26,923,288 shares. The mentioned changes placed institutional holdings at 44,676,316 shares, according to the latest SEC report filing. NPTN stock had 53 new institutional investments in for a total of 2,567,350 shares, while 24 institutional investors sold positions of 2,573,165 shares during the same period.

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