Soitec’s Rally Hits New Highs as Nomura Bets on a 250-Euro Target

Nomura’s decision to initiate coverage on Soitec with a buy rating and a 250-euro price target sent the French semiconductor materials specialist’s shares soaring more than 14% on Friday, propelling the stock to a fresh year-to-date peak of 170 euros. The move marks the latest chapter in a stunning turnaround that has seen the stock surge roughly 578% since the start of 2026.

The Japanese brokerage’s bullish call landed at a moment when Soitec is riding a wave of artificial intelligence-driven demand. The company’s Photonics-SOI wafers, used in optical transceivers for AI data centers, have become a key growth engine, now accounting for around 17% of total revenue for the 2026 fiscal year. Industry analysts project the market for these specialized substrates will expand at an annual rate exceeding 30%, with the potential for further acceleration from co-packaged optics (CPO) technology—though widespread adoption of CPO is still at least three years away.

The AI tailwind has been a powerful counterweight to weakness in Soitec’s core markets. Despite the photonics boom, more than 80% of the company’s sales still come from smartphones and automotive applications, a concentration that leaves the stock exposed to cyclical downturns. The valuation reflects this tension: at 92 times expected earnings for 2028, the shares trade at a steep premium that demands sustained execution.

Should investors sell immediately? Or is it worth buying Soitec?

Soitec’s most recent quarterly report showed revenue of 160 million euros, but management has guided for sequential growth of 20% in the fourth quarter, signaling that an operational recovery is underway. The company is due to release full-year results for fiscal 2026 in late May, a report that will test whether the predicted rebound in the final quarter justifies Nomura’s optimistic outlook.

Technically, the stock’s momentum remains formidable. The share price has blown past its 50-day moving average, now sitting at 72.15 euros, leaving a wide gap that underscores the ferocity of the recent rally. The Relative Strength Index (RSI) has cooled to 38.6, suggesting a short-term breather, while the key support level sits around 157.90 euros. The stock is currently trading just below its 52-week high of 157.65 euros, though Friday’s surge to 170 euros has already set a new annual record.

Investors will be watching the May earnings release closely to see how management plans to offset the ongoing cyclical weakness in mobile handsets with the accelerating photonics business. For now, Nomura’s 250-euro target implies the rally still has significant room to run—provided the AI-driven growth story continues to deliver.

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Soitec Stock: New Analysis - 8 May

Fresh Soitec information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

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