Key Highlights

● Jefferies started FormFactor at Buy with a $102 price target.

● FormFactor shares rose 11.85% on Wednesday.

● FormFactor was among the biggest winners of Jefferies' coverage launches.

● Chip stocks wobbled Thursday on reports about Nvidia's leadership.

Jefferies picked Wednesday to launch coverage of several chip-equipment and AI-infrastructure suppliers, and FormFactor (NASDAQ:FORM) was among the biggest winners. The broker started the semiconductor test specialist at Buy with a $102 price target, and the shares rose 11.85%.

Thursday's setup is less friendly. ET, and no new company announcement. The stock is in focus as chip stocks wobble on reports about Nvidia (NASDAQ:NVDA)'s leadership.

What FormFactor does

FormFactor, based in Livermore, California, makes probe cards, the precision interfaces that let chipmakers test each die on a wafer before it is cut and packaged, along with probe stations and related measurement systems. Probe cards are consumed as chip designs change, which ties the Business to new product ramps at memory, logic and foundry customers.

Memory is especially important. High-bandwidth memory, the stacked DRAM that sits beside AI accelerators, requires extensive testing, and Demand for HBM has been one of the strongest threads in the AI build-out. That is the backdrop for Jefferies' broader initiation, which also included Buy ratings on Teradyne (NASDAQ:TER), with a $284 price target, and Corning (NYSE:GLW), which the firm tied to an AI-driven fiber shortage. Teradyne rose 8.30% and Corning 7.43% on Wednesday.

A $102 target is an analyst's 12-month view, not a forecast from this publication, and targets are often revised as conditions change.

A strong Wednesday, a shaky Thursday

FormFactor's jump came on a powerful day for chips. The PHLX Semiconductor index rose 5.7% on Wednesday to its highest finish since Nov. 3, with every component higher, according to session data. Micron (NASDAQ:MU) gained 11.89% and Sandisk (NASDAQ:SNDK) 13.69%, highlighting the strength in memory-related names.

Overnight, the mood shifted. Nvidia fell roughly 6% to 7% in pre-market trading, and memory and equipment names followed: Micron was down about 2.7% and Lam Research (NASDAQ:LRCX) about 1.9%. Nasdaq-100 futures were down about 0.63% at roughly 5:26 a.m. ET.

That index has held up better than large-cap tech in futures trading on Thursday, but semiconductor suppliers tend to move with the chip sector regardless of size. After an almost 12% one-day gain, some profit-taking would not be unusual on a weak tech morning.

What to Watch Next for FormFactor

The core risk is cyclicality. Test spending can drop quickly if memory makers cut Capital budgets or if AI demand cools. Customer concentration among a handful of large chipmakers and export restrictions on sales to China are additional exposures for the group.

The next sector catalyst arrives after the bell on Thursday, when Applied Materials (NASDAQ:AMAT) reports results. The company expects Revenue of about $10.25 billion and adjusted Earnings of $4.02 a share, according to earnings previews, with Options implying a move of roughly 7.9%. Commentary on memory and advanced packaging could ripple through test and measurement names like FormFactor. Nvidia's own results on Nov. 17 are the larger test for AI-linked suppliers.