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Why Amkor Technology Stock Is Tumbling Today

By Chris Neiger – Oct 12, 2021 at 4:21PM

Key Points

  • Credit Suisse analyst Randy Abrams lowered his price target for Amkor's stock. 
  • The analyst also downgraded the stock to a neutral rating. 

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Investors weren't happy to see that Amkor's stock was downgraded.

What happened 

Shares of Amkor Technology (AMKR -1.18%), a semiconductor packaging and test services company, were falling today after the company's stock received a downgrade from Credit Suisse analyst Randy Abrams. 

The tech stock had fallen by 11.3% as of 3:46 p.m. EDT.

So what 

Abrams downgraded Amkor's stock to a neutral rating, down from outperform, and put a price target on the stock of $27, which was down from $28.50. While that wasn't welcome news, the analyst still believes the company could reach the higher end of its third-quarter sales guidance.  

A red line pointing down.

Image source: Getty Images.

Of course, investors don't like to see a stock get downgraded or for its target price to be lowered, so it's no surprise that Amkor's stock took a hit today. 

But today's drop may sting a little more than usual considering that the stock has been sliding over the past four weeks and, with today's drop, Amkor's share price is down nearly 20% over the past month.  

Now what 

Amkor released solid results for the second quarter (reported on Oct. 4), with sales increasing 20% and EBITDA spiking 40% from the year-ago quarter.  

The company's management also issued guidance for the third quarter, with sales expected to be in the range between $1.65 billion to $1.75 billion. That represents a nearly 30% increase, at the high end of Amkor's guidance. 

While today's share price dive isn't a fun experience, long-term investors may want to take it in stride. Amkor's stock is still up 77% over the past year and, based on its revenue guidance for the third quarter, the company appears to be on pace for more growth. 

 

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

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Stocks Mentioned

Amkor Technology Stock Quote
Amkor Technology
AMKR
$27.69 (-1.18%) $0.33

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