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Ultra Clean Holdings (UCTT) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Ultra Clean Holdings (UCTT) closed the most recent trading day at $23.81, moving -1.67% from the previous trading session. This change lagged the S&P 500's daily gain of 1.2%. At the same time, the Dow added 1.7%, and the tech-heavy Nasdaq gained 1.13%.

Wall Street will be looking for positivity from UCTT as it approaches its next earnings report date. In that report, analysts expect UCTT to post earnings of $0.41 per share. This would mark year-over-year growth of 95.24%. Our most recent consensus estimate is calling for quarterly revenue of $309 million, up 16.44% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.45 per share and revenue of $1.17 billion. These totals would mark changes of +59.34% and +9.73%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for UCTT. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.86% lower. UCTT is currently a Zacks Rank #4 (Sell).

Valuation is also important, so investors should note that UCTT has a Forward P/E ratio of 16.76 right now. This valuation marks a discount compared to its industry's average Forward P/E of 30.3.

It is also worth noting that UCTT currently has a PEG ratio of 2.09. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Electronics - Manufacturing Machinery was holding an average PEG ratio of 2.09 at yesterday's closing price.

The Electronics - Manufacturing Machinery industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 190, which puts it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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