RMBS Should I Buy
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Rambus Inc (RMBS) is not a strong buy for a beginner, long-term investor at this moment. While the company has shown positive revenue growth and maintains a leadership position in its industry, recent challenges such as disappointing earnings guidance, CFO resignation, and ongoing investigations create uncertainty. Additionally, technical indicators and options sentiment do not strongly support immediate entry. Holding off for more clarity or a better entry point is advisable.
The MACD is negatively expanding at -2.12, indicating bearish momentum. The RSI of 32.638 is neutral but trending towards oversold territory. Moving averages are converging, showing no clear trend. The stock is trading near its S1 support level of 94.222, with resistance at 108.161. Overall, technical indicators suggest caution.
Hedge funds are increasing their positions, with a 113.16% rise in buying activity last quarter.
Analysts remain optimistic about Rambus's long-term potential, particularly in DDR5 product cycles and AI data center use cases.
Revenue grew 18.09% YoY in Q4 2025, showcasing strong growth.
Disappointing earnings guidance and a quality issue with a back-end OSAT partner have raised concerns.
CFO resignation adds uncertainty to leadership stability.
Investigations into potential securities fraud and corporate governance issues could weigh on investor sentiment.
In Q4 2025, revenue increased by 18.09% YoY to $190.24M, net income grew by 2.63% YoY to $63.84M, and EPS rose by 1.75% YoY to 0.58. However, gross margin dropped by 1.94% YoY to 78.86%, indicating some pressure on profitability.
Analysts have mixed views. Susquehanna lowered the price target to $90 with a Neutral rating, citing updated estimates. Evercore ISI reduced its target to $119 but maintained an Outperform rating, highlighting long-term growth potential despite short-term challenges. William Blair initiated coverage with an Outperform rating, emphasizing Rambus's leadership in DRAM memory solutions.
