ICHR · Ichor Holdings
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $60.99
Note written ·
Price against the kill line
41.4% 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 $60.99, on record since 11 November 2026. The shares are down 50.3% 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 $60.99, just under the 200-day average of closes, which would show the shares leading the S&P 500. Fourth-quarter revenue above the $365 million top of Ichor's guide, with positive operating cash flow, would also show the shares leading.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 25 September 2026, filed 3 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 329
- Revenue, change on a year (%)
- +37.4
- Gross margin (%)
- 15.8
- Operating margin (%)
- 6.9
- Free cash flow, four quarters ($M)
- −67.2
- Net cash, cash less debt ($M)
- 94.4
- Price to earnings (×)
- 381.9
- Enterprise value to sales (×)
- 1.1
All filed numbers
What Ichor Holdings 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 ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 329 | +37.4 | 15.8 | 6.9 |
| first filed | 295 | +22.7 | 13.9 | 2.4 |
| first filed | 256 | +4.7 | 12.6 | 0.8 |
| first filed | 224 | −4.2 | 9.4 | −6.2 |
| first filed | 239 | +13.3 | 4.6 | −8.1 |
| first filed | 240 | +18.2 | 11.3 | −2.0 |
| Pre-tax income ($M) | 22.3 |
| Net income ($M) four quarters: 3.5 | 20.9 |
| Diluted shares, change on a year (%) against the quarter to 26 September 2025 | +11.1 |
| Operating cash flow ($M) | −38.4 |
| Capital spending ($M) | 28.8 |
| Free cash flow ($M) | −67.2 |
| Cash and short-term investments ($M) | 214 |
| Debt ($M) long-term debt | 119 |
| Net cash, cash less debt ($M) | 94.4 |
| Deferred revenue ($M) | Not reported |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 141 |
| Inventory ($M) | 330 |
| Shareholders' equity ($M) | 888 |
| Market value ($M) | 1,342 |
| Enterprise value, market value plus net debt ($M) | 1,248 |
| Enterprise value to sales (×) | 1.1 |
| Enterprise value to operating income (×) | 68.4 |
| Price to earnings (×) | 381.9 |
| Price to book value (×) | 1.5 |
| Free-cash-flow yield (%) | −5.0 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 7.1% of shares outstanding sold short, 3.5 days of average trading to cover, −16.1% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $2.6M |
| 12 monthsfrom | $145K | $14.0M |
The thesis
Ichor Holdings' shares are more likely to lag the S&P 500 over the next three months than to beat it. Third-quarter operating cash flow was negative $28.8 million and inventory rose, and the fourth-quarter report, expected in early February 2027, shows whether cash flow turns. The shares closed at $37.07 on 12 November 2026, down 47.8% over three months.
Ichor makes fluid-delivery subsystems for chip-making equipment. Its 2 November 2026 release reported third-quarter revenue of $328.7 million, up 37% from a year earlier. Non-GAAP (adjusted) earnings per share were $0.63 against a $0.45 consensus estimate, per Benzinga.
Customer demand turned out strong. Applied Materials, one of two customers behind roughly 90% of Ichor's revenue, reported fiscal fourth-quarter revenue of $10.41 billion on 12 November 2026, up 53% from a year earlier. It guided the next quarter to $11.1 billion, plus or minus $500 million (Applied Materials release). The report covers the quarter Ichor has already guided, so it supports the $345–365 million revenue range and leaves the cash-flow question open.
The market has already cut its expectations sharply. The shares closed at $71.05 on 14 August 2026, and the 52-week intraday high of $113.58 came on 1 July 2026. The rebound from a $28.03 close on 5 November 2026 has left the shares under both the 50-day average of $49.19 and the 200-day average of $61.02.
Bullish and bearish views on Ichor Holdings
The bull case on Ichor Holdings (ICHR), in brief: customer demand is accelerating. The bear case: operations consumed cash.
Bull case
- Customer demand is accelerating. Applied Materials' Semiconductor Systems revenue was $7,996 million in its fiscal fourth quarter, up from $4,879 million a year earlier, and its first-quarter guide of $11.1 billion sits above the $10.41 billion just reported (Applied Materials release, 12 November 2026). Lam Research reported September-quarter revenue of $8.22 billion on 21 October 2026 and guided the December quarter to $8.60 billion plus or minus $400 million, per secondary summaries.
- Revenue landed inside guidance, and guidance rises. Third-quarter revenue of $328.7 million was up 12% from the second quarter. Ichor guided the fourth quarter to $345–365 million and non-GAAP earnings per share of $0.65–$0.75 (company release, 2 November 2026).
- Earnings beat on margin. Non-GAAP gross margin was 16.0% and non-GAAP operating margin 8.6%. Non-GAAP earnings per share of $0.63 compared with a $0.45 estimate (Benzinga, 2 November 2026).
- Brokers kept Buy ratings. B. Riley lowered its target to $60 from $70 on 9 November 2026 and kept Buy. Needham's target is $55, Stifel's $93 and TD Cowen's $55, all Buy after the 3 November 2026 cuts (Benzinga).
- Proprietary content is increasing. Proprietary content within gas systems exceeded 30% exiting the third quarter, up from 25%, and management expects about 35% by the fourth-quarter exit (Panabee summary of the call, 2 November 2026).
Bear case
- Operations consumed cash. Third-quarter operating cash flow was negative $28.8 million, with capital expenditures of $10.7 million. Cash fell $43.0 million to $213.5 million (company release, 2 November 2026).
- Inventory keeps building. Inventories rose to $330.2 million from $290.7 million in the second quarter. Total debt was about $119 million, made up of $6.25 million current and $112.8 million long-term (company release, 2 November 2026).
- Fourth-quarter guide sits below consensus revenue. The $345–365 million range has a $355 million midpoint, under the $363.067 million consensus estimate cited by Benzinga on 2 November 2026.
- Margins are thin. Non-GAAP gross margin of 16.0% leaves little room if input or labour costs rise while capacity is added (company release, 2 November 2026).
- Targets were cut sharply. Four brokers lowered targets after the report, and B. Riley cut again on 9 November 2026. Needham's cut was from $88 to $55 (Benzinga, 3 November 2026). DA Davidson assumed coverage on 9 November 2026 at Buy with a $37 target, close to the 12 November 2026 close.
- Insiders sold and equity was issued into strength. Director Iain MacKenzie sold 20,000 shares at an average $50.66 on 15 September 2026. Chief financial officer Greg Swyt sold 689 shares at $65.01 and chief operating officer Bruce Ragsdale sold 2,149 shares at $65.47, both on 2 October 2026 (SEC Form 4 filings, all under Rule 10b5-1 plans). Ichor completed a $200 million at-the-market equity program in the second quarter (company release, 3 August 2026).
Price setup
The shares closed at $37.07 on 12 November 2026, 67.4% below the 52-week intraday high of $113.58 on 1 July 2026. The three-month change is −47.8%. The 52-week closing low is $14.25 on 20 November 2025.
Closes after the post-earnings low were $28.03 on 5 November 2026, $30.96 on 6 November 2026, $34.45 on 9 November 2026, $35.27 on 10 November 2026, $37.45 on 11 November 2026 and $37.07 on 12 November 2026. The last close is below the 50-day average of $49.19 and well below the 200-day average of $61.02.
The Applied Materials release came after the close on 12 November 2026, so the session of 12 November 2026 does not reflect it. The company filed its 10-Q on 3 November 2026, and the latest SEC Form 4 filing is dated 5 October 2026.
Catalysts ahead
- ~2 February 2027 (est.): Ichor fourth-quarter 2026 results; date unconfirmed. Tests the $345–365 million revenue guide and shows whether operating cash flow turns positive after the third-quarter outflow of $28.8 million.
What would change the view
A daily close above $60.99, just under the 200-day average of closes, which would show the shares leading the S&P 500. Fourth-quarter revenue above the $365 million top of Ichor's guide, with positive operating cash flow, would also show the shares leading.
What it trades with
Ichor's orders follow Lam Research and Applied Materials, which together account for roughly 90% of revenue, so their quarterly results and wafer fab equipment spending outlooks move the shares more than Ichor's own news. Applied Materials said DRAM made up 33% of its Semiconductor Systems revenue in the fiscal fourth quarter, up from 28% a year earlier (12 November 2026). Lam raised its 2026 wafer fab equipment outlook to the low $150 billion range on 29 July 2026.
Memory makers add to that demand. Micron's 30 September 2026 release showed fiscal 2026 net capital expenditures of $27.37 billion and a fiscal first-quarter 2027 revenue guide of $61.5 billion, plus or minus $1.5 billion. A cut in memory or foundry spending plans would reach Ichor through Lam and Applied.
The evidence, claim by claim (8)
- Third-quarter 2026 revenue was $328.7 million, up 12% from the second quarter and 37% from a year earlier; non-GAAP gross margin 16.0%; non-GAAP diluted earnings per share $0.63 against a $0.45 consensus estimate. Ichor third-quarter 2026 results release; Benzinga consensus · as of
- Third-quarter operating cash flow was negative $28.8 million and capital expenditures $10.7 million; inventories rose to $330.2 million from $290.7 million in the second quarter; cash fell $43.0 million to $213.5 million. Ichor third-quarter 2026 results release · as of
- Fourth-quarter 2026 guidance: revenue $345–365 million and non-GAAP earnings per share $0.65–$0.75; the consensus revenue estimate was $363.067 million. Ichor third-quarter 2026 results release; Benzinga consensus · as of
- Applied Materials reported fiscal fourth-quarter 2026 revenue of $10.41 billion, up 53% from a year earlier, and non-GAAP earnings per share of $4.16; it guided the fiscal first quarter of 2027 to revenue of $11.1 billion, plus or minus $500 million, and earnings per share of $4.35, plus or minus $0.20. Applied Materials fourth-quarter fiscal 2026 results release · as of
- Applied Materials' Semiconductor Systems revenue was $7,996 million in the fiscal fourth quarter, up from $4,879 million a year earlier; DRAM was 33% of it, up from 28%. Applied Materials fourth-quarter fiscal 2026 results release · as of
- After the third-quarter report Needham cut its Ichor target to $55 from $88, Stifel to $93 from $115, TD Cowen to $55 and B. Riley to $70, all keeping Buy. Benzinga, 'Ichor Analysts Slash Their Forecasts After Q3 Results' · as of
- B. Riley Securities cut its Ichor target to $60 from $70 and kept Buy; DA Davidson assumed coverage at Buy with a $37 target. Company news (analyst actions) · as of
- Director Iain MacKenzie sold 20,000 shares at an average $50.66 on 15 September 2026; CFO Greg Swyt sold 689 shares at $65.01 on 2 October 2026; both under Rule 10b5-1 plans. SEC Form 4 filings · as of
Sources
- Applied Materials Q4 earnings: record $10.41B revenue · stocktitan.net ·
- Finviz
- Ichor Analysts Slash Their Forecasts After Q3 Results · itiger.com ·
- Lam Research September 2026 equipment growth · xenospectrum.com
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