Ichor Holdings (ICHR) moved into focus after updating its guidance, indicating fourth quarter 2025 revenue slightly above prior expectations and setting preliminary first quarter 2026 revenue of at least US$240 million.

The guidance update arrives after a sharp shift in sentiment, with Ichor’s 30 day share price return of 73.50% and 90 day share price return of 45.23% contrasting with a 1 year total shareholder return close to flat and negative total shareholder returns over 3 and 5 years. This suggests recent momentum has picked up against a weaker longer term record as investors reassess growth prospects and risks ahead of the upcoming earnings release.

If this kind of semiconductor story has your attention, it could be a good moment to look across the sector with high growth tech and AI stocks.

With Ichor now trading above its average analyst price target and recent gains far outpacing its mostly flat 1 year return, you have to ask: is there still mispricing here, or is the market already baking in the recovery?

Preferred Price to Sales Ratio of 1.1x: Is It Justified?

Ichor is trading at US$30.57 with a P/S ratio of 1.1x, which sits well below both peers and the broader US semiconductor industry.

The P/S ratio compares a company’s market value to its revenue and is often used for businesses that are currently loss making, as is the case here. For Ichor, this metric suggests the market is pricing each dollar of sales at a discount to other semiconductor names, despite its role supplying critical fluid delivery subsystems to major equipment makers.

Compared to the US semiconductor industry average P/S of 5.6x and a peer average of 9.8x, Ichor’s 1.1x looks materially lower. It also sits below the estimated fair P/S ratio of 1.5x, a level the market could move towards if sentiment and fundamentals stay aligned with that regression based fair ratio signal.

Result: Price to Sales ratio of 1.1x (UNDERVALUED)

However, recent losses of US$40.763 million and a share price already above the US$28.29 analyst target could quickly challenge the recovery narrative if sentiment cools.

Another Take: Our DCF Model Sees Things Differently

While the 1.1x P/S suggests Ichor could be cheap, our DCF model points the other way, with the current US$30.57 price sitting above an estimated fair value of US$29.68. That gap is not huge, but it raises a simple question for you: is this really a discount or just close to full price?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Ichor Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 876 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Ichor Holdings Narrative

If you see the numbers differently or prefer to walk through the data yourself, you can build a fresh story for Ichor in just a few minutes, starting with Do it your way.

A great starting point for your Ichor Holdings research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

Ready for more investment ideas?

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• Spot potential bargains early by checking out these 876 undervalued stocks based on cash flows that may be pricing in more caution than their cash flows suggest.
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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.