Camtek Ltd. (NASDAQ: CAMT)

Camtek Ltd. (NASDAQ: CAMT) is engaged in the manufacturing of metrology and inspection equipment and a provider of software solutions serving Advanced Packaging, Memory, (complementary metal oxide semiconductor) CMOS Image Sensors, (micro-electromechanical systems) MEMS, RF, and others.

Recommendation Rationale – Sell at USD 88.90

• The disruption to CAMT’s business by negative effects on the semiconductor industry, including because of economic, political, legal, regulatory and other changes, in the global or local markets might impact the company’s overall performance
• Also, the geopolitical tensions might lead to export control restrictions, trade sanctions, tariffs and more generally international trade regulations which could impact the company’s ability to sell and deliver the systems, technology, and services.
• CAMT’s Cash and cash equivalents, short-term and long-term deposits, and marketable securities, as of June 30, 2024, stood at $453.9 Mn as compared to $466.3 Mn as of March 31, 2024. During the second quarter, it posted an operating cash flow of $42.2 Mn.
• The company’s share price surpassed its R1 level recommended on September 25, 2024. Therefore, there can be a possible decline from the specified resistance levels.

CAMT’s Daily Price Chart

CAMT Daily Technical Chart, Data Source: REFINITIV

Fundamental Valuation:

P/E Based Relative Valuation

CAMT is exposed to the risks related to uncertain macro-economic environment, global economic trends like recession, rising inflation, rising interest rates, economic slowdown, etc.

Therefore, CAMT is expected to trade at slight discount considering the risks associated. For conducting the valuation, the following peers have been considered: Lam Research Corp (LRCX.OQ), Onto Innovation Inc (ONTO.N), etc.

Given its current trading levels, recent rally in the share price, and risks associated, it is prudent to book profit at the current levels.

Hence, a ‘Sell’ rating is assigned to the “CAMT” at the current market price of USD 88.90 (as of 26 September 2024, at 06:45 am PDT). 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Camtek Ltd. (NASDAQ: CAMT) is a part of Kalkine’s Global Big Money Report

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 26 September 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.