Back to top

Aggressive Growth

Flextronics (FLEX - Snapshot Report) just beat earnings expectations last week. Estimates are rising on the company's guidance, pushing shares to a Zacks #1 Rank (Strong Buy)

Company Description

Flextronics is an electronics manufacturing services company for the auto, computing, consumer, industrial and other industries.

Great Quarter

On Jan 20 Flextronics reported its third-quarter results that showed a 19% year over year sales growth, to $7.8 billion. Net income improved 23%, to $232 million.

Earnings per share came in a penny ahead of the Zacks Consensus Estimate, at 23 cents. This was Flextronics' seventh consecutive earnings surprise.

Outlook Improving

After the company said it expected to see revenue between $7.1 and $7.4 billion in the fourth quarter, analysts began raising estimates. The average forecast for fiscal 2011 is up 2 cents, to 81 cents.

Next year's Zacks Consensus Estimate is calling for 97 cents, up 6 cents on unanimous upward revisions from 7 analysts. Given the 66 cents the company earned in fiscal 2009, you have expected growth rates of 23% and 20%, respectively.

Attractive Valuations

Flextronics' shares are trading at just 10 times this year's estimates and with a PEG ratio near 0.9. The P/E ratio is near the peer group average, but the PEG is better than most.

The Chart

FLEX dipped slightly on the earnings news and saw some additional volatility around options expiration, but this leaves the stock at a good place to buy.

Flextronics - ticker FLEX >

 
<P ALIGN=

Bill Wilton is the Aggressive Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Small Cap Trader service

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%