Why Shares of Ultra Clean Holdings Are Surging Today

What happened

Shares of Ultra Clean Holdings (NASDAQ: UCTT), a supplier of systems and subsystems to the semiconductor equipment industry, jumped on Thursday after the company reported its fourth-quarter results. Ultra Clean beat analyst estimates for both revenue and earnings, sending the stock up 12% by 11:30 a.m. EST.

So what

Ultra Clean reported fourth-quarter revenue of $174.5 million, up 68.8% year over year and about $1.5 million higher than the average analyst estimate. Semiconductor revenue rose 60.7% year over year, while revenue derived from outside the U.S. jumped 126.2%.

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Image source: Ultra Clean Holdings.

Non-GAAP EPS came in at $0.36, up from a loss of $0.01 during the prior-year period and $0.09 better than analysts were expecting. Gross margin increased more than 4 percentage points year over year to 17%, driving earnings higher.

Ultra Clean expects to produce between $190 million and $197 million of revenue during the first quarter of 2017, along with non-GAAP EPS between $0.40 and 0.45. The company produced revenue of just $112 million during the first quarter of 2016.

Now what

Ultra Clean President and CEO Jim Scholhamer said the company was on track to meet its long-term targets:

With a solid close to 2016 and guidance calling for continued growth, investors had plenty of reasons to push up the stock on Thursday.

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Timothy Green has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.