The upward momentum in the stock market this week ran out of steam on Friday afternoon, as the Nasdaq Composite (^IXIC +0.88%) and S&P 500 (^GSPC +0.77%) gave up early gains to close slightly lower. However, the pullbacks weren't consequential, and modest gains for the Dow Jones Industrial Average (^DJI +0.75%) showed the market's overall strength for the week.
|
Index |
Daily Percentage Change |
Daily Point Change |
|---|---|---|
|
Dow |
+0.33% |
+114 |
|
S&P 500 |
(0.10%) |
(5) |
|
Nasdaq |
(0.18%) |
(25) |
Data source: Yahoo! Finance.
A couple of stocks stood out as extremely strong performers on Friday. Aehr Test Systems (AEHR +2.99%) continued its impressive run from the past few years, reporting strong financial results. Meanwhile, Glaukos (GKOS +3.54%) got a vote of confidence from stock analysts, marking the second positive view this week.
Aehr passes the test
Shares of Aehr Test Systems jumped 18% on Friday. The supplier of test and production burn-in equipment for the semiconductor industry announced fiscal fourth-quarter financial results for the period ended May 31, and investors were quite happy with the tiny company's upward trajectory.
Aehr's numbers for the quarter were actually somewhat modest. Sales of $22.3 million were up just 10% or so year over year. Net income of $6.1 million set a record, but the resulting $0.21 per share in earnings was just a penny higher than what Aehr posted in the year-ago period. Adjusted earnings were actually flat on a per-share basis due to a rise in share count that offset roughly 5% gains on the bottom line. For the full 2023 fiscal year, sales climbed 28% to $65 million, and adjusted net income soared 62% from 2022 levels to $14.6 million.
NASDAQ: AEHR
Key Data Points
But it's Aehr's future that investors are most focused on, and the company expects to hit the accelerator in the coming year. CEO Gayn Erickson said that Aehr's record results hinged in large part on its silicon carbide semiconductor products, because these chips are used extensively in electric vehicles and the equipment that helps to charge EVs. Indeed, Aehr brought on a new silicon carbide semiconductor client in the past quarter, and all of the company's newer customers are ramping up production to meet soaring demand.
Aehr's fiscal 2024 guidance called for revenue to jump more than 50% to $100 million or more, with net income nearly doubling to $28 million. Investors still like that kind of growth, and a small company like Aehr has a long potential growth runway ahead of it.
Glaukos impresses investors
Elsewhere, shares of Glaukos gained 10%. The ophthalmic medical technology and pharmaceutical specialist concentrates on therapies that treat glaucoma, corneal disorders, and retinal diseases, and stock analysts have increasingly recognized the value of Glaukos' product line in helping patients with eye problems.
The latest move came from Wells Fargo (WFC +0.35%), which increased its price target on the stock by $12 per share to $75. Yet the analysts kept an equal-weight rating on Glaukos, checking their enthusiasm about the company, and the new price target was only slightly above where the stock closed Thursday afternoon.
NYSE: GKOS
Key Data Points
Several other analysts have pointed to Glaukos' promise with price target increases. On Monday, Citi boosted its target by $26 to $85 per share, following Stifel's move in late June to add $12 per share to its price target and raise it to $77.
Glaukos won't report its latest financial results until early August, but investors are hopeful that its current medical device line and pipeline will continue to bear out in the years to come. As excitement mounts about its near-term prospects, Glaukos could continue moving back toward its record highs from 2021.
