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Does The Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) Share Price Fall With The Market?

Simply Wall St



Check out our latest analysis for Kulicke and Soffa Industries

What KLIC's beta value tells investors

Given that it has a beta of 1.38, we can surmise that the Kulicke and Soffa Industries share price has been fairly sensitive to market volatility (over the last 5 years). Based on this history, investors should be aware that Kulicke and Soffa Industries are likely to rise strongly in times of greed, but sell off in times of fear. Beta is worth considering, but it's also important to consider whether Kulicke and Soffa Industries is growing earnings and revenue. You can take a look for yourself, below.

NasdaqGS:KLIC Income Statement, December 11th 2019

Could KLIC's size cause it to be more volatile?

Kulicke and Soffa Industries is a small company, but not tiny and little known. It has a market capitalisation of US$1.6b, which means it would be on the radar of intstitutional investors. It has a relatively high beta, which is not unusual among small-cap stocks. Because it takes less capital to move the share price of a smaller company, actively traded small-cap stocks often have a higher beta that a similar large-cap stock.

What this means for you:

Since Kulicke and Soffa Industries has a reasonably high beta, it's worth considering why it is so heavily influenced by broader market sentiment. For example, it might be a high growth stock or have a lot of operating leverage in its business model. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as Kulicke and Soffa Industries’s financial health and performance track record. I urge you to continue your research by taking a look at the following:

  1. Future Outlook: What are well-informed industry analysts predicting for KLIC’s future growth? Take a look at our free research report of analyst consensus for KLIC’s outlook.
  2. Past Track Record: Has KLIC been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look at the free visual representations of KLIC's historicals for more clarity.
  3. Other Interesting Stocks: It's worth checking to see how KLIC measures up against other companies on valuation. You could start with this free list of prospective options.

