Freedom Capital Markets has begun coverage of FormFactor, Inc. (NASDAQ: FORM) with a Hold recommendation and a price target of $64.00. At the time of the initiation the shares were trading at $73.76, while analyst targets in the market run from $50 up to $96, per InvestingPro data.
In its initiation note the research house highlighted several strategic advantages that support FormFactor’s competitive position. Among those, Freedom pointed to the company’s long-standing role as a close collaborator and trusted supplier to major Western chipmakers, an IP-rich product portfolio and a direct exposure to rising demand for AI chips.
Freedom Capital Markets signaled confidence in FormFactor’s technology roadmap and customer relationships, and it cited what it described as a track record of strategic capital deployment. Supporting those operational assessments, InvestingPro data indicate FormFactor’s balance sheet shows a current ratio of 4.3 and that the company holds more cash than debt.
Despite these positives, the firm raised concerns about the present risk-reward for new investors following a substantial increase in FormFactor’s share price since the company reported third-quarter 2025 results. Freedom noted the stock has risen roughly 80% since that report. InvestingPro data also show a 93.4% return over the past year and a 117.1% gain over the past six months, and the stock currently appears overvalued versus its Fair Value, according to the same data.
Freedom also cautioned that FormFactor’s advantages do not eliminate exposure to industry-specific risks. The firm listed volatile customer order patterns, accelerated product development timelines, unpredictable global trade conditions and the variable fortunes of major customers as factors that could produce earnings and topline volatility.
Investors are reminded that FormFactor is scheduled to report earnings on February 4 - which at the time of the initiation is eight days away. The firm suggested investors seeking a deeper read can consult the comprehensive Pro Research Report for FormFactor and other US equities available through InvestingPro.
Recent corporate moves and analyst reactions were also noted in the research landscape. FormFactor has announced the acquisition of Keystone Photonics, a company that focuses on optical probing for silicon photonics and co-packaged optics wafer testing. Freedom framed that transaction as a move to strengthen capabilities in silicon photonics, an area expected to grow as AI infrastructure demand expands.
At the same time, FormFactor is carrying out a restructuring that consolidates manufacturing operations in California and is expected to affect between 200 and 300 employees. Company guidance on that plan frames the consolidation as an effort to improve gross margins and better match manufacturing capacity with demand.
Several other brokerages have adjusted their views recently, reflecting the mix of operational momentum and valuation questions. Northland raised its target to $44 from $23 after a reported earnings beat and tightened guidance; Stifel increased its target to $65 from $42 while maintaining a Buy rating and emphasizing the company’s strength in AI packaging; Cantor Fitzgerald initiated coverage with an Overweight rating and a $75 target, citing performance relative to industry averages. Freedom’s Hold initiation and $64 target sits within that spectrum of analyst views spanning $50 to $96.
Overall, Freedom Capital Markets’ initiation portrays FormFactor as a strategically valuable supplier with robust financial liquidity and exposure to secular AI demand, but one whose recent share-price appreciation has compressed the margin of safety for new capital commitments. The firm’s note underscores that core strengths do not remove exposure to order volatility, product-timing pressure, trade-related uncertainty and customer concentration risks.