Why GT Advanced Technologies Shares Soared

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 GT Advanced Technologies (NASDAQOTH: GTATQ  ) rose by more than 16% during intraday trading Thursday after being upgraded to "buy" from "neutral" by analysts at UBS.

So what: UBS made the call after reviewing survey results which indicate an increased percentage of sapphire content in recently launched, big-name products including the protective covers for Samsung's new smart watch, as well as the fingerprint sensors in Apple's colorful new iPhone family. Naturally, this should benefit GTAT, which not only produces and sells sapphire material, but also builds and markets the furnaces required to create the scratch-resistant product.

Now what: Today's upgrade follows a similar positive note last week from analysts at Canaccord Genuity, who maintained the firm's buy rating on GTAT shares shortly after Apple's initial fingerprint sensor announcement. The Canaccord statement, for its part, noted this development should also cause sapphire prices to rise to GTAT's benefit.

Considering GTAT had to revise its full-year revenue guidance downward in May after nixing around $356 million in "at risk" sapphire furnace orders, this news comes as welcome relief to weary shareholders, showing their investment might be worth the risk, after all.

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  • Report this Comment On September 19, 2013, at 3:59 PM, banmate7 wrote:

    I not sure there are any compelling fundamentals here. But I am happy, as I'm up in GTAT by 88% in the last year. Hope this continues.

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