AXT Inc (NASDAQ:AXTI) Surges 13.35% as Brokerages Hike Price Target to $9.69

AXT, Inc. (NASDAQ:AXTI) surged 13.35% in pre-market trading on December 19, 2025, building on a 39% rally over the previous month and a staggering 543% gain year-to-date. Despite this momentum, the stock’s price-to-sales (P/S) ratio of 6.9x exceeds the Semiconductor industry average, where over half of companies trade below 5.1x. Analysts caution that AXT’s revenue performance has deteriorated, with a 4.5% decline last year and a cumulative 41% drop over three years, raising questions about the sustainability of its valuation. While five analysts project 29% revenue growth for 2026—well below the industry’s 44% forecast—the elevated P/S suggests investors are betting on a turnaround. However, recent earnings reports highlighted permit delays and weaker-than-expected results, complicating the outlook.

Amid mixed signals, AXT’s stock has attracted renewed attention following a price target hike to $9.69 and a “Moderate Buy” consensus from brokerages. A recent export permit win in China and renewed institutional buying activity have fueled optimism. Yet, analysts remain divided, with some firms like Wedbush cutting price targets while maintaining outperform ratings. Short interest has fallen by 24.4%, reflecting reduced bearish sentiment.

The stock’s 200-day moving average crossover and retail investor enthusiasm further underscore its volatility, though earnings guidance for Q3 2025 remains cautious. Investors are advised to monitor upcoming quarterly results and regulatory developments, which could sway sentiment in either direction.

Historically, AXT has shown mixed performance, with earnings volatility and sector-specific challenges impacting its long-term growth trajectory. The recent price target increase is supported by strong demand in China, but analysts caution that these gains may not be sustainable without consistent revenue growth. Institutional investors have been buying in gradually, signaling tentative confidence, yet the market remains cautious due to the company's earnings performance and operational constraints.

Given the current valuation and market sentiment, many traders and investors are evaluating whether AXT’s price surge is a short-term anomaly or a sign of a genuine turnaround. While the stock has shown resilience in the face of sector-wide headwinds, its ability to convert this optimism into long-term revenue and earnings growth will be the key to unlocking further upside.