Evercore ISI raised its price target for Nova Measuring Instruments to $485.00 from $340.00 on Friday while maintaining an Outperform rating on the shares of the semiconductor equipment supplier. The research house said the upward revision reflects expectations that Nova will outpace the broader wafer fabrication equipment, or WFE, market.
In its note, Evercore ISI forecasted 19% year-over-year growth for Nova in 2026. The firm attributed that projected outperformance to anticipated share gains tied to gate-all-around, or GAA, technology as well as strength in advanced memory and advanced packaging segments.
Evercore ISI observed that Nova is working off an industry backdrop where the company itself expects WFE to expand in the low-double digits. That outlook, the note said, is consistent with guidance offered by KLA Corporation. Evercore ISI highlighted that the expected WFE growth is being led by activity in leading-edge foundry and logic markets together with DRAM markets.
The research house also pointed to broader fundamentals in the semiconductor equipment group as supportive. Specifically, Evercore ISI noted that capital expenditure as a percentage of sales and operating income for TSMC and memory companies remain well below historical norms, a dynamic the firm views as positive for the equipment segment.
On performance, Nova Measuring Instruments has risen 33% year-to-date. Evercore ISI compared that advance with gains of 20% to 40% seen across other semiconductor equipment stocks over the same period, and with a 1% increase in the S&P 500. The firm noted the stock currently trades at 43 times earnings, which it described as an 89% premium to the S&P 500.
Implications for markets and sectors
- Semiconductor equipment sector - Evercore ISI's view implies continued demand strength in leading-edge and memory-related tool segments.
- Foundry and logic markets - These end markets are cited as contributors to the expected WFE growth trajectory.
- Memory sector - DRAM markets are specifically listed as a driver of WFE expansion.
This article does not include additional commentary beyond the firm statements and data cited above.