Shares of electronic design, test equipment and solutions provider Keysight Technologies, Inc. (KEYS) have surged 55.3% over the past year. KEYS recently posted better-than-expected performance for the fourth quarter on the back of robust growth and improvements across key metrics.
With these developments in mind, let us take a look at the changes in the company’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, KEYS’ top two risk categories are Finance & Corporate and Macro & Political, each contributing 23% to the total 39 risks identified. Compared to a sector average of 9%, the company’s Macro & Political risk factor is at 23%.
In its recent annual report, the company has added one key risk factor under the Legal & Regulatory risk category.
KEYS is committed to achieving net-zero emissions by the end of the fiscal year 2040. The company plans to achieve this goal by lowering energy consumption, investing in renewable energy, and selectively purchasing certified offsets for residual emissions.
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Furthermore, the company has also committed to developing approved science-based targets in accordance with limiting global warming to 1.5 degrees Celsius. Developing and implementing these goals and targets may lead to substantial and expensive capital improvements, changes in product developments, manufacturing processes, and logistics methods.
These factors could increase prices for customers, lower product performance, or create customer dissatisfaction, impacting KEYS’ revenue and profitability. Additionally, failing to achieve these targets could result in regulatory non-compliance, action against the company, or penalties.
Wall Street’s Take
On December 13, J.P. Morgan analyst Samik Chatterjee reiterated a Buy rating on the stock and increased the price to $230 from $220 (16.6% upside potential).
Consensus on the Street is a Moderate Buy based on 8 Buys and 3 Holds for the stock. The average Keysight price target of $207.73 implies a potential upside of 5.3%.
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