Renishaw won an upgrade to 'buy' from 'hold' at Panmure Liberum, which raised its price target to 6,160p from 5,320p.
That implies upside of about 13% from 5,460p, where the FTSE 250 precision engineering group traded at lunchtime.
Analyst Oliver Swift said annual results held no surprises after July's trading update, but exit rates at two of the three divisions were extremely strong.
Sales rose 14% to £816 million in the year to June, while underlying operating profit climbed 35% to £153 million.
Position Measurement, which makes encoders that track movement in machines, was the standout, with operating profit up 53% to £72 million on semiconductor demand.
Sales in that division grew 51% in the fourth quarter, up from 36% in the third.
Specialised Technologies, home to the 3D printing business, swung to a £5 million profit from a £10 million loss as revenue jumped 43%.
Industrial Metrology lagged, with profit up just 2% as currency headwinds squeezed margins.
Panmure lifted its earnings per share forecasts by 10% for the current year and 9% for next, and argued its numbers remain conservative.
Management said the new financial year had started strongly, helped by demand for chipmaking equipment.
The broker welcomed a £51 million special dividend, worth 70p a share, and extra spending to expand encoder capacity at the Miskin plant.
Swift said Renishaw's end markets were in the early stages of a prolonged upcycle.
The shares trade on 22.8 times 2027 earnings, which Panmure described as attractive for the growth on offer.
