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Relative valuation derived from Technology sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 42.3GRADE C
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
79.2%
Sector: -1.4%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, NOVA LTD. (NVMI) receives a "Hold" rating with a composite score of 52.4/100, ranked #524 out of 4446 stocks. Key factor scores: Quality 42/100, Value 55/100, Momentum 86/100. This is quantitative analysis only — not investment advice.
NOVA LTD. (NVMI) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does NOVA LTD. Do?
Nova Ltd. designs, develops, produces, and sells process control systems used in the manufacture of semiconductors in Israel, Taiwan, the United States, China, Korea, and internationally. Its product portfolio includes a set of metrology platforms for dimensional, films, and materials and chemical metrology measurements for process control for various semiconductor manufacturing process steps, including lithography, etch, chemical mechanical planarization, deposition, electrochemical plating, and advanced packaging. The company serves various sectors of the integrated circuit manufacturing industry, including logic, foundries, and memory manufacturers, as well as process equipment manufacturers. Nova Ltd. was formerly known as Nova Measuring Instruments Ltd. and changed its name to Nova Ltd. in July 2021. The company was incorporated in 1993 and is headquartered in Rehovot, Israel. NOVA LTD. (NVMI) is classified as a large-cap stock in the Technology sector, specifically within the Measuring And Control Equipment industry. The company is led by CEO Eitan Oppenhaim and employs approximately 1,180 people. With a market capitalization of $14.2B, NVMI is one of the prominent companies in the Technology sector.
NOVA LTD. (NVMI) Stock Rating — Hold (April 2026)
As of April 2026, NOVA LTD. receives a Hold rating with a composite score of 52.4/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.NVMI ranks #524 out of 4,446 stocks in our coverage universe. Within the Technology sector, NOVA LTD. ranks #33 of 584 stocks, placing it in the top 10% of its Technology peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
NVMI Stock Price and 52-Week Range
NOVA LTD. (NVMI) currently trades at $498.93. The stock gained $4.85 (1.0%) in the most recent trading session. The 52-week high for NVMI is $507.27, which means the stock is currently trading -1.6% from its annual peak. The 52-week low is $154.00, putting the stock 224.0% above its annual trough. Recent trading volume was 94K shares, suggesting relatively thin trading activity.
Is NVMI Overvalued or Undervalued? — Valuation Analysis
NOVA LTD. (NVMI) carries a value factor score of 55/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 78.30x, compared to the Technology sector average of 45.27x — a premium of 73%. The price-to-book ratio stands at 15.22x, versus the sector average of 3.16x. The price-to-sales ratio is 5.25x, compared to 1.06x for the average Technology stock. On an enterprise value basis, NVMI trades at 15.53x EV/EBITDA, versus 12.79x for the sector.
Overall, NVMI's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
NOVA LTD. Profitability — ROE, Margins, and Quality Score
NOVA LTD. (NVMI) earns a quality factor score of 42/100, signaling below-average profitability metrics relative to the broader market. The return on equity (ROE) is 79.2%, compared to the Technology sector average of -1.4%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 52.9% versus the sector average of -1.0%.
On a margin basis, NOVA LTD. reports gross margins of 57.6%, compared to 50.9% for the sector. The operating margin is 27.9% (sector: -0.5%). Net profit margin stands at 27.3%, versus -1.5% for the average Technology stock. Profitability is below benchmark levels, which may reflect industry headwinds, elevated reinvestment, or structural challenges.
NVMI Debt, Balance Sheet, and Financial Health
NOVA LTD. has a debt-to-equity ratio of 19.0%, compared to the Technology sector average of 43.0%. The low leverage indicates a conservative balance sheet with significant financial flexibility. Total debt on the balance sheet is $181M. Cash and equivalents stand at $158M.
NVMI has a beta of 1.82, meaning it is more volatile than the broader market — a $10,000 investment in NVMI would be expected to move 82.0% more than the S&P 500 on any given day. The stability factor score for NOVA LTD. is 47/100, reflecting average volatility within the normal range for its sector.
NOVA LTD. Revenue and Earnings History — Quarterly Trend
In TTM 2026, NOVA LTD. reported revenue of $672M and earnings per share (EPS) of $6.31. Net income for the quarter was $184M. Gross margin was 57.6%. Operating income came in at $188M.
In FY 2024, NOVA LTD. reported revenue of $672M and earnings per share (EPS) of $6.31. Net income for the quarter was $184M. Gross margin was 57.6%. Revenue grew 29.8% year-over-year compared to FY 2023. Operating income came in at $188M.
In FY 2023, NOVA LTD. reported revenue of $518M and earnings per share (EPS) of $4.73. Net income for the quarter was $136M. Gross margin was 56.6%. Revenue grew -9.3% year-over-year compared to FY 2022. Operating income came in at $132M.
In FY 2022, NOVA LTD. reported revenue of $571M and earnings per share (EPS) of $4.89. Net income for the quarter was $140M. Gross margin was 55.5%. Revenue grew 37.2% year-over-year compared to FY 2021. Operating income came in at $150M.
Over the past 8 quarters, NOVA LTD. has demonstrated a growth trajectory, with revenue expanding from $251M to $672M. Investors analyzing NVMI stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
NVMI Dividend Yield and Income Analysis
NOVA LTD. (NVMI) does not currently pay a dividend. This is common among growth-oriented companies in the Measuring And Control Equipment industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Technology dividend stocks may want to explore other Technology stocks or use the stock screener to filter by dividend yield.
NVMI Momentum and Technical Analysis Profile
NOVA LTD. (NVMI) has a momentum factor score of 86/100, indicating strong price momentum with the stock outperforming the majority of the market over recent periods. Stocks with high momentum scores have historically tended to continue their outperformance in the near term. The investment factor score is 41/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 14/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
NVMI vs Competitors — Technology Sector Ranking and Peer Comparison
Comparing NVMI against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full NVMI vs S&P 500 (SPY) comparison to assess how NOVA LTD. stacks up against the broader market across all factor dimensions.
NVMI Next Earnings Date
No upcoming earnings date has been announced for NOVA LTD. (NVMI) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy NVMI? — Investment Thesis Summary
NOVA LTD. presents a balanced picture with arguments on both sides. Price momentum is positive at 86/100, suggesting the trend favors buyers.
In summary, NOVA LTD. (NVMI) earns a Hold rating with a composite score of 52.4/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on NVMI stock.
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Institutional Research Dossier
NOVA LTD. (NVMI) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Nova Ltd. (NVMI) receives a Hold rating, driven by its strong momentum and profitability, but tempered by a high valuation and moderate quality score. While Nova operates in a critical niche within the semiconductor manufacturing industry and demonstrates impressive financial performance, its current price appears to reflect much of its future growth potential, leaving limited upside for new investors.
The company's robust revenue growth and high margins are attractive, but the premium valuation, significantly exceeding sector averages, warrants caution. Investors should closely monitor the company's ability to sustain its growth trajectory and maintain its competitive edge in the face of evolving technological demands and increasing competition within the semiconductor metrology market.
Business Strategy & Overview
Nova Ltd. specializes in process control metrology solutions for the semiconductor manufacturing industry. Its core business revolves around designing, developing, and selling advanced metrology systems that measure critical parameters during the various stages of semiconductor fabrication. These measurements include dimensional characteristics, film thickness, material composition, and chemical properties, all of which are essential for ensuring the quality and performance of semiconductor devices.
The company's product portfolio caters to a wide range of semiconductor manufacturing processes, including lithography, etching, chemical mechanical planarization (CMP), deposition, electrochemical plating, and advanced packaging. By offering a comprehensive suite of metrology solutions, Nova positions itself as a key partner for integrated circuit manufacturers, foundries, and memory manufacturers. The company's strategic focus on these sectors allows it to capitalize on the increasing complexity and miniaturization of semiconductor devices, which demand more precise and sophisticated metrology tools.
Nova's geographic footprint spans across major semiconductor manufacturing hubs, including Israel, Taiwan, the United States, China, and Korea. This global presence enables the company to serve a diverse customer base and adapt to regional market dynamics. The company's sales and service network provides localized support and ensures timely delivery of its products and services.
The company's strategy also involves continuous innovation and product development. Nova invests heavily in research and development to stay ahead of the curve and introduce new metrology solutions that address the evolving needs of the semiconductor industry. This commitment to innovation is crucial for maintaining its competitive edge and capturing new market opportunities. The company's ability to anticipate and respond to technological advancements in semiconductor manufacturing will be a key determinant of its long-term success.
Execution Benchmarks audit
Gross Margin
Core pricing power
57.6%
Sector: 50.9%
+13% VS SCTR
Economic Moat Analysis
Nova possesses a narrow economic moat, primarily derived from intangible assets and switching costs. The company's specialized knowledge and expertise in semiconductor metrology, coupled with its proprietary technology, create a barrier to entry for potential competitors. Developing and validating advanced metrology systems requires significant investment in research and development, as well as a deep understanding of semiconductor manufacturing processes. This specialized knowledge is difficult to replicate, giving Nova a competitive advantage.
Switching costs also contribute to Nova's moat. Semiconductor manufacturers invest significant time and resources in integrating Nova's metrology systems into their production lines. Once these systems are integrated and validated, switching to a competitor's solution can be costly and time-consuming. This creates a degree of customer stickiness and reduces the likelihood of customers switching to alternative providers, even if they offer slightly lower prices.
However, the moat is not wide due to the presence of established competitors with their own proprietary technologies and strong customer relationships. Companies like KLA Corporation and Applied Materials also offer advanced metrology solutions and compete directly with Nova. These competitors have significant resources and established market positions, which limit Nova's ability to command premium pricing or capture a dominant market share.
Furthermore, the rapid pace of technological change in the semiconductor industry poses a threat to Nova's moat. New manufacturing processes and device architectures require new metrology solutions, and companies that fail to innovate and adapt risk losing their competitive edge. Nova must continuously invest in research and development to maintain its technological leadership and defend its market position. The company's ability to successfully navigate these technological challenges will be crucial for preserving its narrow economic moat.
Financial Health & Profitability
Nova's financial health is generally strong, characterized by robust revenue growth, high margins, and solid cash flow generation. The company's revenue has grown significantly over the past several years, from $148.51 million in FY2015 to $672.40 million in FY2024. This growth reflects the increasing demand for advanced metrology solutions in the semiconductor industry, as well as Nova's ability to capture market share.
The company's gross margins are consistently high, ranging from 54.2% to 59.1% over the past decade. This indicates that Nova has strong pricing power and efficient cost management. The operating margin has also improved significantly over time, from 7.8% in FY2015 to 27.9% in FY2024. This reflects the company's ability to scale its operations and leverage its fixed costs.
Nova's return on equity (ROE) is exceptionally high at 79.2%, significantly exceeding the sector average of -1.5%. This indicates that the company is generating substantial profits from its equity base. However, it's important to note that ROE can be influenced by leverage, and Nova's debt-to-equity ratio of 19.00 is relatively low compared to the sector average of 43.00.
The company's cash flow generation has been volatile over the past decade, with periods of strong free cash flow (FCF) generation followed by periods of negative FCF. This volatility is partly due to fluctuations in working capital and capital expenditures. However, the company has generally generated positive FCF in recent years, indicating that it has sufficient cash to fund its operations and invest in future growth. The increase in FCF from $63.66M in FY2023 to $178.25M in FY2024 is a positive sign.
While the company holds $157.78M in cash, it also carries $180.56M in debt. This net debt position is manageable given the company's strong cash flow generation, but it's something to monitor. Overall, Nova's financial health is sound, but investors should pay attention to the company's cash flow volatility and debt levels.
Valuation Assessment
Nova's valuation is a significant concern, as it trades at a substantial premium to its peers and the broader market. The company's price-to-earnings (P/E) ratio of 73.7x is significantly higher than the sector average of 45.3x. This suggests that investors are expecting high growth from Nova in the future.
Similarly, the company's enterprise value-to-EBITDA (EV/EBITDA) ratio of 16.3x is also higher than the sector average of 13.0x. This indicates that the company is more expensive relative to its earnings before interest, taxes, depreciation, and amortization.
While Nova's free cash flow (FCF) generation has improved in recent years, the company's FCF yield is still relatively low, given its high valuation. This suggests that investors are not receiving a significant return on their investment in terms of cash flow.
Given Nova's high valuation, the stock appears to be fully priced, if not overvalued. The current price reflects much of the company's future growth potential, leaving limited upside for new investors. While Nova's strong financial performance and growth prospects may justify a premium valuation, the magnitude of the premium warrants caution. Investors should carefully consider the risks associated with investing in a high-valuation stock, particularly in a cyclical industry like semiconductors.
A discounted cash flow (DCF) analysis, which is not possible with the provided data, would be necessary to determine a more precise intrinsic value. However, based on the available data, it appears that Nova's stock is trading at a premium to its intrinsic value.
Risk & Uncertainty
Nova faces several risks and uncertainties that could impact its future performance. One of the most significant risks is the cyclical nature of the semiconductor industry. Demand for semiconductor manufacturing equipment, including metrology systems, is highly correlated with the overall health of the semiconductor market. Economic downturns or periods of overcapacity can lead to reduced capital spending by semiconductor manufacturers, which would negatively impact Nova's revenue and earnings.
Competition is another significant risk. Nova operates in a competitive market with several established players, including KLA Corporation and Applied Materials. These competitors have significant resources and established customer relationships, which could make it difficult for Nova to maintain its market share. The company must continuously innovate and develop new metrology solutions to stay ahead of the competition.
Technological change also poses a risk. The semiconductor industry is characterized by rapid technological advancements, and new manufacturing processes and device architectures require new metrology solutions. If Nova fails to anticipate and respond to these technological changes, it could lose its competitive edge. The company must invest heavily in research and development to maintain its technological leadership.
Customer concentration is another potential risk. While the specific customer concentration is not provided, a significant portion of Nova's revenue may be derived from a small number of key customers. If one or more of these customers reduce their capital spending or switch to a competitor's solution, it could have a material adverse effect on Nova's financial performance.
Bulls Say / Bears Say
The Bull Case
BULL VIEWNova's strong revenue growth and high margins demonstrate its ability to capitalize on the increasing complexity of semiconductor manufacturing, making it a prime beneficiary of industry trends.
BULL VIEWThe company's commitment to innovation and product development ensures that it will remain at the forefront of metrology technology, allowing it to capture new market opportunities and maintain its competitive edge.
BULL VIEWWith the semiconductor industry poised for continued growth, driven by demand for advanced devices in areas like AI and 5G, Nova is well-positioned to benefit from increased capital spending by semiconductor manufacturers.
The Bear Case
BEAR VIEWNova's high valuation leaves little room for error, and any slowdown in revenue growth or margin compression could lead to a significant correction in the stock price.
BEAR VIEWThe cyclical nature of the semiconductor industry poses a significant risk, and a potential economic downturn could lead to reduced capital spending by semiconductor manufacturers, negatively impacting Nova's financial performance.
BEAR VIEWCompetition from larger, more established players like KLA Corporation and Applied Materials could limit Nova's ability to gain market share and maintain its premium pricing.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score NVMI and 4,400+ other equities.
NOVA LTD. exhibits a 218% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
52.9%
Sector: -1.0%
Gross Margin
Pricing power and cost efficiency
57.6%
Sector: 50.9%
Operating Margin
Core business profitability
27.9%
Sector: -0.5%
Net Margin
Bottom-line profitability
27.3%
Sector: -1.5%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
