Nova Earnings: What To Look For From NVMI

Adam Hejl /
2023/11/08 2:03 am EST

Semiconductor quality control company Nova (NASDAQ: NVMI) will be reporting earnings tomorrow before market open. Here's what investors should know.

Last quarter Nova reported revenues of $122.7 million, down 13.4% year on year, in line with analyst expectations. It was a mixed quarter for the company, with a solid beat of analysts' EPS estimates but an increase in its inventory levels.

Is Nova buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Nova's revenue to decline 14.5% year on year to $123.1 million, a further deceleration on the 27.7% year-over-year decrease in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.09 per share.

Nova Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 3.5%.

Looking at Nova's peers in the semiconductor manufacturing segment, some of them have already reported Q3 earnings results, giving us a hint what we can expect. Teradyne's revenues decreased 14.9% year on year, beating analyst estimates by 2.9% and Entegris reported revenue decline of 10.6% year on year, missing analyst estimates by 0.4%. both stocks (Teradyne and Entegris) traded flat on the results. 

Read our full analysis of Teradyne's results here and Entegris's results here.

Tech stocks have had a rocky start since 2022 and while some of the semiconductor manufacturing stocks have fared somewhat better, they have not been spared, with share price declining 6% over the last month. Nova is down 7.2% during the same time, and is heading into the earnings with analyst price target of $137.5, compared to share price of $99.4.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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The author has no position in any of the stocks mentioned.