Tower Semiconductor Ltd: Visibility extends to '29

Tower Semiconductor reported a Q3 beat. It noted capacity expansion plans ahead of schedule, and customer contracts now extending into 2029E. We believe Tower's strong market position in SiPho pluggables and NPO remains unchanged and that demand clearly continues to exceed supply. We continue to expect upside to the 2028 target model, while we watch for how pricing/margins trend given competitors' SiPho ramps. We lower our FY26-28E revenue estimates by 1-6% and adjust margins, resulting in +3%/-0.4%/-6% changes to FY26/27/28E EBITDA. We lower our PO to $310/ILS 974 (from $367/ILS 1,020) on 18x on 2028E EV/EBITDA, reflecting AI industry capex uncertainties. Buy.