Frencken Group (E28.SI) saw its stock plummet by 3.45% in Wednesday's trading session, despite a relatively stable revenue outlook for the second half of the year. The sharp decline comes as investors weigh the company's financial prospects against potential headwinds in its semiconductor segment.

According to a note from UOB Kay Hian analyst John Cheong, Frencken's second-half revenue is expected to be broadly stable compared to the first half. The technology solutions provider reported a 16% year-on-year increase in first-half revenue, with growth seen in both the semiconductor and medical segments. While the company anticipates these segments to maintain stable revenue in the second half, concerns are emerging about the semiconductor division.

Investors appear to be reacting to potential risks facing Frencken's semiconductor segment, including the uncertainty surrounding U.S. tariffs on chips and their impact on the semiconductor-equipment sector. Despite these challenges, UOB Kay Hian maintains a buy rating on the stock with a target price of S$2.08, significantly higher than the current trading price of S$1.42. The stark contrast between the analyst's optimistic outlook and the stock's negative performance suggests that market sentiment may be more cautious about Frencken's near-term prospects in light of the semiconductor industry's uncertainties.