Ichor officers sold 19 times in an eightfold run. Q3 results on November 2 decide who read it right
The chip tool parts maker gave back most of a 12-month, eightfold run in a single session this week, after a year in which its officers sold 19 times and bought twice. Q3 results on November 2 decide whether the margin story or the insider ledger was right.
Vincent Jiang · 3 min read
On Friday, October 16, Ichor Holdings closed at $42.11, down 9.73 percent in one Nasdaq session 1. The Fremont, California company makes the gas and chemical delivery subsystems that sit inside the chipmaking tools sold by Applied Materials−4.89% — Applied Materials, down 4.89 percent today and Lam Research−4.95% — Lam Research, down 4.95 percent today. That same session its two biggest customers fell 4.82 and 4.87 percent 1. The supplier bled twice as fast as the buyers of its parts.
On October 16 the subsystems maker fell twice as hard as its two biggest customers
Data
| Value | |
|---|---|
| Ichor (ICHR) | 9.73 |
| Lam Research | 4.87 |
| Applied Materials | 4.82 |
Twelve months from $14 to $113, then most of it gone
The run was real: a 52-week low of $14.06, a high of $113.58, and a market cap that reached $2.37 billion in early October before settling at $1.6 billion 13. The business grew with it. June-quarter revenue hit $294.8 million, up 24 percent year over year, and adjusted gross margin expanded 230 basis points year over year to 14.1 percent 16. But 14 percent is a thin margin for a company carrying this story, and on a GAAP basis the price-to-earnings ratio is negative at minus 35.95 1.
While the stock ran, the officers sold
The ledger is lopsided. Over the past year insiders sold 19 times and bought twice 3. On October 2, COO Bruce Ragsdale sold 2,149 shares at a weighted average $65.47 under a trading plan adopted June 2 2. The same day, CFO Greg Swyt sold 689 shares at $65.01, his 32,239th share sold over the past year against zero bought 3. In the June quarter the company itself raised $195.4 million net by selling 2.5 million shares through an at-the-market offering at an average $80.70 6. Friday's close of $42.11 sits below every one of those prices 1.
The bear case found its mechanism
Oppenheimer warned on October 14 that component supply is uneven, "from cables to valves", after an execution hiccup hurt the June quarter 45. Management had already conceded that isolated part shortages stopped it recognizing its full Q2 revenue forecast before quarter end 6. Note the rating context: Oppenheimer has Ichor at Perform with an $80 target since August, and the eight-analyst consensus is Buy with a $94.12 average target, 123 percent above the close 8. The warning is caution inside a bullish street.
The company itself sold stock near $81; its officers near $65; the market now pays $42
Data
| Value | |
|---|---|
| 52-week low | 14.06 |
| Close, Oct 16 | 42.11 |
| Insider sales, Oct 2 | 65.47 |
| ATM offering, avg | 80.7 |
| 52-week high | 113.58 |
Both camps get their answer on November 2
Ichor guided Q3 to $315-345 million of revenue, 14.5 to 15.5 percent adjusted gross margin and 40 to 50 cents of adjusted EPS 67. Wall Street Zen upgraded the stock to buy on October 17 1. One print now separates them: if margins clear 15 percent, the insiders sold too early; if supply snags pin gross margin near 14 percent again, the sellers were the only ones reading the factory floor. The scoreboard opens after the close on November 2.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
