Fabrinet's 15min chart shows KDJ Death Cross, Bearish Marubozu signals.

Fabrinet's 15-minute chart has triggered a KDJ Death Cross and a Bearish Marubozu at 10/01/2025 14:30, indicating a shift in the momentum of the stock price towards the downside. This suggests that the potential for further price decrease is high, with sellers currently controlling the market. Furthermore, the bearish momentum is likely to continue.

Fabrinet (FN) has been making significant strides in its diversification efforts beyond the optical communications sector, with its automotive and industrial laser segments emerging as substantial growth drivers. In the fourth quarter of fiscal 2025, non-optical communications revenues reached $221 million, a 41% year-over-year increase, demonstrating the effectiveness of this strategy Is FN's Diversification Beyond Optics Poised to Drive Further Upside?^[1].

The automotive segment, which contributed $128 million, benefited from robust demand for electric vehicle (EV) charging infrastructure and advanced sensors. Fabrinet's focus on EV charging components rather than traditional auto parts positions it to capitalize on the accelerating electrification trend while leveraging its precision electro-mechanical expertise. Meanwhile, industrial lasers added $40 million, providing steady contributions from automation and processing equipment. These markets broaden Fabrinet’s exposure to secular growth themes that are less cyclical than communications.

Fabrinet's diversification strategy has not only driven revenue growth but also outpaced overall revenue expansion, suggesting the company's ability to capture market share in adjacent verticals. The Zacks Consensus Estimate for the first-quarter fiscal 2026 non-optical revenues is pegged at $231 million, indicating a year-over-year increase of 29.8% Is FN's Diversification Beyond Optics Poised to Drive Further Upside?^[1].

However, recent technical indicators suggest caution. Fabrinet's 15-minute chart has triggered a KDJ Death Cross and a Bearish Marubozu at 10/01/2025 14:30, indicating a shift in the momentum of the stock price towards the downside. This suggests that the potential for further price decrease is high, with sellers currently controlling the market. Furthermore, the bearish momentum is likely to continue Find High Risers Like Fabrinet Early with Money Flows^[2].

Fabrinet faces stiff competition from Jabil (JBL) and Coherent (COHR), both of which are expanding in adjacent markets. Despite this competition, Fabrinet's focus on precision electro-mechanical components and EV charging infrastructure provides a differentiated positioning that could support sustained growth momentum Is FN's Diversification Beyond Optics Poised to Drive Further Upside?^[1].

Fabrinet's shares have jumped 66.8% in the year-to-date period, outperforming the Zacks Electronics-Miscellaneous Components industry and the Zacks Computer and Technology sector's increase of 40% and 22.6%, respectively. From a valuation standpoint, Fabrinet stock is currently trading at a forward 12-month Price/Sales ratio of 3.06X compared with the industry’s 2.08X. The Zacks Consensus Estimate for Fabrinet’s first-quarter fiscal 2026 earnings is pegged at $2.83 per share, indicating 18.41% year-over-year growth Is FN's Diversification Beyond Optics Poised to Drive Further Upside?^[1].

Investors should be mindful of the recent technical signals and consider Fabrinet's competitive landscape when making investment decisions. While the company's diversification strategy has yielded strong results, the potential for further price decreases suggests a need for caution.