Small-cap semiconductor equipment maker Photronics continues to trade near an 18-year high despite the current overall market correction. On Monday, Photronics stock got an upgrade to its Relative Strength (RS) Rating, with a rise from 67 to 75.
Photronics Stock Closing In On Winner's Circle
The upgraded 75 RS Rating means that Photronics stock topped 75% of all stocks for price performance over the past year. Market research shows that the market's biggest winners often have an 80 or better RS Rating in the early stages of their moves. See if Photronics stock can clear that threshold.
Photronics makes photomasks, a design template of the chip that chipmakers use to print the chip design onto a silicon wafer. Then their chipmaking equipment cuts the wafer into individual chips for use in computers, home electronics and other devices.
Improvements among semiconductor equipment company stocks sometimes indicate an impending rise in the overall chip market as chipmakers gear up for higher production.
Its other ratings are mixed. The chip equipment maker boasts a top-notch 94 Earnings Per Share Rating out of 99, largely based on strong earnings last year. Its 76 Composite Rating is a good but not-yet-great rating. IBD's Composite Rating score combines five separate proprietary ratings into one. The best growth stocks have a Composite Rating of 90 or better.
One yellow flag is its E Accumulation/Distribution Rating on an A+ to E scale with A+ best and E worst. The E rating shows that funds are selling more shares than buying. However, that's mitigated a bit by the rising number of top-rated funds that hold Photronics stock. The number rose from 442 in the March-ended quarter to 452 in June.
Mixed Results Over Past Year
Photronics has posted sales and earnings gains every quarter over the past year, but its results have been erratic, with a downward trend. Earnings grew 55%, 25%, 42% and then 9% last quarter to 51 cents per share. Revenue grew 16%, 11%, 12% and then 2% to $224.2 million. Look for improved performance when the Brookfield, Conn.-based company reports its current quarter earnings.
On April 27, Photronics stock dropped to a 13.86 intraday low and then turned up. From there it nearly doubled to 26.98 on July 18, an 18-year high. It's consolidated amid the current general market retreat. On Monday, Photronics stock was down fractionally.
Looking For The Best Stocks To Buy And Watch? Start Here
Photronics stock holds the No. 12 rank among its peers in the 27-stock Electronics-Semiconductor Equipment industry group. Axcelis Technologies and Aehr Test Systems are among the group's highest-rated stocks.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.
IBD's proprietary Relative Strength Rating identifies price performance with a 1 (worst) to 99 (best) score. The score shows how a stock's price movement over the last 52 weeks compares to all the other stocks in our database.
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