PDF Solutions' stock fell 5.66% in pre-market trading on Friday, a significant decline that comes despite the company reporting better-than-expected quarterly results.

The semiconductor equipment and testing company reported adjusted earnings of 31 cents per share for the quarter ended March 31, beating analyst estimates of 23 cents. Revenue also exceeded expectations, rising 25.9% to $60.13 million. However, the stock had already appreciated significantly prior to the report, with shares rising 47.0% during the quarter and gaining 68.6% year-to-date.

Analysts maintain a "buy" rating on the stock, but the median 12-month price target of $41.50 is approximately 15.9% below the last closing price of $48.09, suggesting concerns about valuation. The pre-market decline appears to reflect a "sell the news" reaction as traders take profits following the substantial prior gains.