Key Stats for Keysight Stock
- Today’s Price Change: 5%
- Current Share Price: $170
- 52-Week High: $169
- TOL Stock Price Target: $139
What Happened?
Keysight Technologies (KEYS) stock is up more than 5% following the release of better-than-expected second-quarter results.
The electronic measurement solutions provider reported earnings of $1.70 per share, surpassing analyst estimates of $1.65. Revenue climbed 7.4% year over year to $1.31 billion, exceeding the $1.28 billion forecast.
The company’s Communications Solutions Group was the standout performer, with revenue up 9% to $913 million, showing balanced growth across commercial communications and aerospace/defense sectors.
Despite macroeconomic uncertainties, Keysight raised its full-year revenue growth expectations to the midpoint of its long-term 5-7% target range.
For the third quarter, it projects earnings between $1.63 and $1.69 per share on revenue of $1.305-$1.325 billion, primarily in line with analyst estimates.
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What the Market Is Telling Us
The positive response to KEYS stock indicates investor confidence in its ability to capitalize on growth opportunities in communications infrastructure and artificial intelligence.
The recent rally in Keysight stock comes despite some headwinds, including tariff-related costs that it estimates will create a $75-$100 million annual headwind, with peak impact expected in the third fiscal quarter.
JPMorgan’s decision to raise its price target on KEYS stock from $172 to $177 while maintaining an “Overweight” rating reflects growing analyst optimism.
The investment firm highlighted Keysight’s robust growth in the Wireline segment, which saw double-digit expansion for the first time. This was driven by significant deployments of 400G and 800G equipment and R&D related to 800G and 1.6T technologies.
However, challenges remain in certain sectors, such as automotive and energy, where Keysight has seen declining demand for EV battery R&D amid industry cutbacks.
The high price-to-earnings ratio of almost 50x for KEYS stock suggests investors are paying a premium for its growth potential. Investors are betting that strength in communications and AI-related businesses will continue to offset weakness in other areas.
Keysight’s planned acquisition of Spirent, which is expected to close in the third fiscal quarter, represents another growth avenue. However, analysts note that it could limit earnings growth in fiscal year 2026 due to margin pressures compared to Keysight’s core business.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
