FormFactor initiated with a Hold at Jefferies on concentrated customer base

Jefferies analyst Vedvati Shrote initiated coverage of FormFactor with a Hold rating and $28 price target as the analyst launched coverage on a pair of Back-End Test Equipment stocks. The industry has transformed into a high-single- to low-double-digit growth segment after "a decade uninspiring growth," said Shrote. While FormFactor is the market leader in the Probe Card market, Shrote views it as a "semi opex" play driven by PC and handset demand. The analyst also points to FormFactor’s concentrated customer base and high fixed cost structure, stating that a more constructive view would require increased market share and a diversified customer base.