FormFactor Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of multiple Foolish newsletter recommendation FormFactor (Nasdaq: FORM  ) are cruising to one-day gains of 11% or more after a nice earnings report with some stellar non-earnings news attached.

So what: The maker of equipment for semiconductor manufacturing processes barely edged out analyst expectations with healthy revenues and a smaller net loss than predicted. The real kicker came from the surprise announcement of a $50 million share buyback program.

Now what: Our own Anand Chokkavelu noted yesterday that FormFactor would do well to consider a buyback allotment, only hours before the announcement. It's a turnaround story in the making, and a tremendously strong balance sheet should help the company through a few more quarters of net losses. It also helps that more than half of the bottom-line damage stems from non-cash accounting adjustments during the quarter.

Interested in more info on FormFactor? Add it to your watchlist by clicking here.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. FormFactor is a Motley Fool Hidden Gems selection. Motley Fool Options has recommended a bull call spread position on FormFactor. The Fool owns shares of FormFactor. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool is investors writing for investors.


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