Cyber Attack Causes Tower Semiconductor To Halt Some Operations

Israel-based chip manufacturer Tower Semiconductor, formerly known as TowerJazz, reported on Sunday that it identified a security breach on some of its systems as a result of a cyber attack.

Tower Semiconductor (TSEM) halted some of its servers and proactively held operations in certain manufacturing facilities as a preventive measure. The company said that it has taken these actions in a gradual, organized manner.

In an update about the cyber attack, the company said, “Tower has notified relevant authorities and is working closely with law enforcement organizations and with a leading team of worldwide experts, coordinated with its insurance providers, in order to recover the impacted systems as soon as possible.”

“The Company has implemented specific measures to prevent the expansion of this event. At this point there is no assessment as to the actual effect on the Company” added the chipmaker.

On August 12, Jefferies analyst Mark Lipacis maintained his Buy rating for Tower Semiconductor with a price target of $25. Lipacis expects the company to post EPS of $0.16 in the third quarter.

The company’s second-quarter EPS declined 10% to $0.18 even as revenue grew 1.3% Y/Y to $310 million. Weakness in the company’s medical X-ray and automotive business was offset by higher sales of mobile and power management chips. (See TSEM stock analysis on TipRanks)

A Moderate Buy consensus for Tower Semiconductor is based on 2 recent Buy ratings. TSEM stock has plunged 21.4% year-to-date, however the average analyst price target of $25 suggests that 32.2% upside potential lies ahead.

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