CEVA · CEVA
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $37.10
Note written ·
Price against the kill line
31.0% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $37.10, on record since 11 November 2026. The shares are down 21.8% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $37.10, the 2 October 2026 close at the top of the autumn rally, which would show the shares leading the S&P 500 and prove this call wrong; so would fourth-quarter 2026 revenue above the $36 million guidance midpoint.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 9 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 29.1
- Revenue, change on a year (%)
- +2.4
- Gross margin (%)
- 85.4
- Operating margin (%)
- −12.1
- Free cash flow, four quarters ($M)
- 5.7
- Net cash, cash less debt ($M)
- 216
- Enterprise value to sales (×)
- 4.4
- Free-cash-flow yield (%)
- 0.8
All filed numbers
What CEVA reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 29.1 | +2.4 | 85.4 | −12.1 |
| first filed | 29.0 | +13.1 | 87.4 | −7.2 |
| first filed | 27.0 | +11.5 | 86.2 | −18.8 |
| first filed | 31.3 | +7.1 | 88.1 | −1.3 |
| first filed | 28.4 | +4.3 | 88.0 | −7.3 |
| first filed | 25.7 | −9.7 | 86.2 | −17.5 |
| Pre-tax income ($M) | −1.2 |
| Net income ($M) four quarters: −10.8 | −2.3 |
| Diluted shares, change on a year (%) | Not reported |
| Operating cash flow ($M) | 11.2 |
| Capital spending ($M) | 5.5 |
| Free cash flow ($M) | 5.7 |
| Cash and short-term investments ($M) | 216 |
| Debt ($M) | None reported |
| Net cash, cash less debt ($M) no debt reported | 216 |
| Deferred revenue ($M) +12.8% on a year | 3.4 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 46.5 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 342 |
| Market value ($M) | 730 |
| Enterprise value, market value plus net debt ($M) no debt reported | 515 |
| Enterprise value to sales (×) no debt reported | 4.4 |
| Enterprise value to operating income (×) | Not meaningful |
| Price to earnings (×) | Not meaningful |
| Price to book value (×) | 2.1 |
| Free-cash-flow yield (%) | 0.8 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 10.3% of shares outstanding sold short, 5.8 days of average trading to cover, −5.2% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $174K | $0 |
The thesis
Ceva, Inc. missed its own third-quarter revenue guidance and cut its implied 2026 growth to about 11%, from the 13–15% it guided in August. The rating is Low: the shares are more likely to lag the S&P 500 until the fourth-quarter report, expected in February 2027, shows a record quarter of about $36 million.
Ceva licenses chip designs for wireless connectivity and on-device artificial intelligence (AI), then earns per-unit royalties when customers ship chips. On 9 November 2026 it reported third-quarter revenue of $29.1 million, up 2% year over year. That was below its $30.5–$34.5 million guidance and the $32.71 million analyst consensus, per Benzinga. Management said a large multi-year connectivity licensing deal expected in the third quarter was signed in early fourth quarter instead.
Royalties did grow. Royalty revenue was $12.7 million, up 18% from the second quarter's $10.8 million but up only 3% year over year. Management's implied 2026 growth of about 11% now rests on a fourth quarter that would be a company record, per its 9 November 2026 earnings call as summarised by MarketBeat.
The price reflects a lower bar. On 9 November 2026, Capital.com reported that the shares traded at 37 times forward 12-month earnings, down from 47 times three months earlier. Four brokers cut their targets on 10 November 2026 but kept them above the 11 November 2026 close of $26.94.
Bullish and bearish views on CEVA, Inc.
The bull case on CEVA, Inc. (CEVA), in brief: royalties rose sharply from the prior quarter. The bear case: revenue missed the company's own range.
Bull case
- Royalties rose sharply from the prior quarter. Third-quarter 2026 royalty revenue was $12.7 million, up 18% sequentially. Management credited a modem ramp at a major U.S. customer in its 9 November 2026 report.
- Unit shipments matched the record. Licensees shipped 623 million Ceva-powered devices in the third quarter, up 8% year over year, per 247 Wall St and Panabee on 9 November 2026. That matched Ceva's all-time quarterly high.
- The slipped deal is already signed. On 9 November 2026 management said the multi-year connectivity agreement missing from the third quarter was signed in early fourth quarter. It guided fourth-quarter revenue to a $36 million midpoint, a company record, with non-GAAP earnings per share (EPS) expected to more than double sequentially.
- AI licensing is a growing share. AI technologies made up more than 35% of third-quarter licensing and related revenue. Six of the 10 licensing deals signed in the quarter covered AI, and three were with first-time customers, per Ceva's 9 November 2026 results.
- The NeuPro processor is in production. On 2 November 2026 Ceva announced the first production deployment of its NeuPro neural processing unit (NPU) family, with Mobilint adopting NeuPro-Nano and SensPro in its REGULUS edge-AI chip. Management said on 9 November 2026 that it expects initial NPU royalties.
- Connectivity customers keep shipping. On 5 November 2026 NSING Technologies said it had shipped more than 250 million Bluetooth chips using Ceva designs.
Bear case
- Revenue missed the company's own range. Third-quarter revenue of $29.1 million fell below the $30.5–$34.5 million guidance given on 10 August 2026. Adjusted EPS of $0.13 missed the $0.19 estimate, per Benzinga on 9 November 2026.
- The full-year outlook came down. At the fourth-quarter midpoint, 2026 revenue growth is about 11%, below the 13–15% guided on 10 August 2026. Management blamed pressure in compute-intensive markets on the 9 November 2026 call.
- Licensing growth stalled. Licensing and related revenue was $16.3 million, up 2% year over year, per Panabee's summary of the 9 November 2026 results. In the second quarter it had grown 21%.
- Memory costs are hurting consumer devices. The chief financial officer said on 9 November 2026 that memory-related softness in compute-intensive consumer devices partly offset royalty gains.
- Analysts cut targets after the report. On 10 November 2026 Oppenheimer cut its target to $35 from $38 and UBS to $35 from $40. JPMorgan, at Neutral, lowered its target to $35, and Stifel lowered its target to $40.
- GAAP losses continue. Capital.com reported a third-quarter net loss of $2.30 million, or $0.08 per share, on 9 November 2026.
Price setup
The shares closed at $26.94 on 11 November 2026. That is below both the 50-day moving average of $30.40 and the 200-day moving average of $30.73. The 3-month change is −11.3%, measured from a $30.37 close on 13 August 2026.
The report moved the shares within a wide range. They closed at $28.02 on 4 November 2026, $24.56 on 5 November 2026 and $27.10 on 6 November 2026. After the results they closed at $24.84 on 9 November 2026 and $24.45 on 10 November 2026, then rebounded to $26.94 on 11 November 2026.
The bigger range runs from the 52-week closing low of $17.21 on 30 March 2026 to the 52-week intraday high of $51.60 on 22 June 2026. The last close is 47.8% below that high. A return above the two moving averages, both near $30.50, would be the first sign the market is pricing the fourth-quarter guidance as achievable.
Catalysts ahead
- ~17 February 2027 (est.): Q4 and full-year 2026 results, with the 2027 outlook. Shows whether revenue reaches the record $36 million guidance midpoint now that the slipped connectivity deal is signed, and whether royalty growth beats Q3's 3% year-over-year pace.
What would change the view
A daily close above $37.10, the 2 October 2026 close at the top of the autumn rally, which would show the shares leading the S&P 500 and prove this call wrong; so would fourth-quarter 2026 revenue above the $36 million guidance midpoint.
What it trades with
Ceva trades with high-beta semiconductor names as well as with its own news. On 16 October 2026 it fell 5.98% alongside Sandisk and Marvell Technology with no company announcement, per Ad-hoc News. In November the moves were company-specific, around the 9 November 2026 results.
The memory cycle now shows up in Ceva's numbers. Management tied part of the 2026 growth cut to memory-related softness in compute-intensive consumer devices, so rising memory prices that squeeze device volumes are a headwind for royalties.
Ceva reports in US dollars but has a large Israel-based research and development staff, so shekel moves affect reported operating costs.
The evidence, claim by claim (7)
- Q3 2026 revenue was $29.1 million, up 2% year over year, below the company's $30.5–$34.5 million guidance and the $32.71 million consensus; adjusted EPS was $0.13 versus a $0.19 estimate. Ceva Q3 2026 results and 8-K, 9 November 2026; Benzinga · as of
- Q3 2026 royalty revenue was $12.7 million, up 3% year over year and 18% sequentially; 623 million Ceva-powered devices shipped, up 8% year over year. Ceva Q3 2026 results, 9 November 2026 · as of
- Q3 2026 licensing and related revenue was $16.3 million, up 2% year over year; AI made up more than 35% of it, and 10 licensing deals were signed, 6 covering AI. Ceva Q3 2026 results, 9 November 2026 · as of
- A large multi-year connectivity licensing deal expected in Q3 2026 was signed in early Q4 2026. Ceva Q3 2026 earnings call · as of
- Q4 2026 revenue guidance midpoint is $36 million, a company record, implying about 11% full-year 2026 revenue growth versus 13–15% guided in August. Ceva Q3 2026 earnings call · as of
- Oppenheimer cut its target to $35 from $38 and UBS cut its target to $35 from $40; JPMorgan (Neutral) lowered to $35 and Stifel (Buy) to $40. Broker notes reported 10 November 2026 · as of
- Mobilint adopted NeuPro-Nano and SensPro in its REGULUS edge-AI chip, Ceva's first production deployment of the NeuPro NPU family. Ceva press release · as of
Sources
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