Why Shares of Ichor Holdings Surged Today

By Timothy Green Markets Fool.com

What happened

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Shares of semiconductor equipment and subsystem provider Ichor Holdings (NASDAQ: ICHR) jumped on Tuesday after the company released preliminary first-quarter results. Ichor also announced that existing shareholders planned to sell 4.5 million shares in a public offering, but the stock still closed up 10.4%.

So what

Ichor expects to produce first-quarter revenue of $148.7 million, toward the high end of its previous guidance range of $140 million to $150 million. GAAP net income of $13.0 million is expected, along with non-GAAP net income of $14.6 million. That works out to non-GAAP EPS of $0.57, compared to the previous guidance range of $0.52 to $0.58.

Image source: Ichor Holdings.

In addition to providing first-quarter numbers, Ichor provided revenue guidance for the second quarter. The company expects to produce revenue between $152 million and $162 million, up 5.6% compared to the first quarter at the midpoint.

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Ichor will report its full first-quarter results after the market closes on May 11.

Now what

With both revenue and non-GAAP EPS coming in at the high end of Ichor's guidance ranges, investors pushed up the stock on Tuesday. Ichor went public in December at $9 per share, and the stock is now more than 130% above that level. While the semiconductor equipment business is cyclical, it's clear that investors like what they see.

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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.