FormFactor (FORM) Valuation Check After Record Results And Strong AI Test Demand Guidance

FormFactor (FORM) has drawn fresh attention after releasing record fourth quarter and full year 2025 results, with earnings and revenue ahead of expectations and guidance that points to meaningfully higher first quarter 2026 revenue.

See our latest analysis for FormFactor.

The earnings beat and upbeat guidance appear to have reset expectations, with FormFactor’s 1 day share price return of 7.65% and 90 day share price return of 68.61% pointing to strong momentum. The 1 year total shareholder return of 151.93% highlights how much sentiment has shifted over a longer stretch.

If FormFactor’s move has you watching semiconductor test suppliers more closely, it could be a good moment to look at other AI hardware enablers through our screener of 33 AI infrastructure stocks.

With FormFactor now trading around US$90 and sitting above the average analyst target, the key question is whether recent AI test demand and record results still leave room for further gains, or if the market is already fully reflecting expectations for future growth.

Most Popular Narrative: 33% Overvalued

FormFactor’s most followed narrative pegs fair value at about $67.88 using a 10.54% discount rate, which sits well below the recent $90.29 close.

Strategic investments in new manufacturing capacity (Farmers Branch, Texas) and vertical integration via organic substrate partnerships aim to expand production, lower long-term operating costs, and leverage financial or regulatory incentives, enabling margin expansion and improved profitability as AI and advanced packaging demand intensifies. (Impacts: Gross margins, net margins)

Read the complete narrative.

Curious what earnings path needs to unfold to support that fair value gap? The narrative leans on faster growth, higher margins, and a richer future P/E. The exact mix of those assumptions may surprise you.

Result: Fair Value of $67.88 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, you still need to weigh the risk that margin pressure from tariffs and product mix, or delays at the Farmers Branch facility, could undercut this upbeat narrative.

Find out about the key risks to this FormFactor narrative.

Build Your Own FormFactor Narrative

If you are not fully convinced by this view or prefer to rely on your own research, you can build a custom FormFactor story from the same data in just a few minutes: Do it your way

A good starting point is our analysis highlighting 1 key reward investors are optimistic about regarding FormFactor.

Looking for more investment ideas?

If FormFactor has sharpened your focus, do not stop here. Widen your watchlist with curated stock ideas that match the kind of opportunities you care about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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