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Will Logitech's (LOGI) Bull Run Continue on Positive Trends?
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Premium computer and mobile accessories manufacturer, Logitech International SA (LOGI - Free Report) has been enjoying a bull run. The company has returned a whopping 51.3% in the past six months, way ahead of the Zacks categorized Computer-Peripheral Equipment industry average of 21.6%.
Analysts have been maintaining a neutral stance toward the stock as the Zacks Consensus Estimate remained unchanged at 88 cents for the past month. However, the stock has a whopping average positive surprise of 125.8%, beating estimates all through, in the trailing four quarters. Going forward, we believe that the stock has more room to run, based on the following drivers.
Factors Driving Growth
The Switzerland-based company’s impressive growth drive is largely attributable to its sturdy business model, diligent restructuring and aggressive expansion into new business categories. Moreover, Logitech’s quarterly results have been benefiting from its robust business model that focuses on maximizing profit in PC peripherals and expanding into new business categories.
As part of its efforts to focus on its high-growth segments, Logitech spun off its struggling Lifesize video conferencing business, and also exited the market in which it supplied mice and keyboards to PC makers. Logitech plans to reduce its overall cost structure by slashing product, overhead and infrastructure costs. Going forward, the company expects to focus on making selective investments to ensure disciplined cost management in the coming quarters.
The company is now focused on retail and online sales of accessories, which are turning out to be real profit churners. Encouragingly, the company is focused on venturing into new businesses and over the past three years, it has grown successful businesses, including Bluetooth Speakers and Video Collaboration via advanced offerings.
Presently, most of the company’s businesses including, Audio-PC & Wearables and Mobile Speakers, Video Collaboration, Retail and cloud-based video conferencing services, have been largely supplementing the top line. One of the company’s most notable collaborations, with technology behemoth – Apple Inc. (AAPL - Free Report) – is proving conducive to the growth of Tablet & Other Accessories segment. Also, gaming business is proving to be a major catalyst, backed by product launches, marketing initiatives and growing trend of PC gaming in the Asia Pacific.
Moving ahead, the company has plans to tap the high potential market for accessories, by pursuing innovation and expanding its product lines. Most of its innovative offerings, like the fastest performing mouse and keyboard switches, have been enjoying an impressive traction, pumping revenues. The Zacks Rank #3 (Hold) company is planning a range of product launches in the coming quarters, to reinforce its foothold in the market.
Identiv recently broke its streak of missing earnings estimates, as it surpassed estimates by an impressive 64.3% in the last reported quarter.
Mercury Systems has three beats over the trailing four quarters and boasts an average positive surprise of 79.1%.
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Will Logitech's (LOGI) Bull Run Continue on Positive Trends?
Premium computer and mobile accessories manufacturer, Logitech International SA (LOGI - Free Report) has been enjoying a bull run. The company has returned a whopping 51.3% in the past six months, way ahead of the Zacks categorized Computer-Peripheral Equipment industry average of 21.6%.
Analysts have been maintaining a neutral stance toward the stock as the Zacks Consensus Estimate remained unchanged at 88 cents for the past month. However, the stock has a whopping average positive surprise of 125.8%, beating estimates all through, in the trailing four quarters. Going forward, we believe that the stock has more room to run, based on the following drivers.
Factors Driving Growth
The Switzerland-based company’s impressive growth drive is largely attributable to its sturdy business model, diligent restructuring and aggressive expansion into new business categories. Moreover, Logitech’s quarterly results have been benefiting from its robust business model that focuses on maximizing profit in PC peripherals and expanding into new business categories.
As part of its efforts to focus on its high-growth segments, Logitech spun off its struggling Lifesize video conferencing business, and also exited the market in which it supplied mice and keyboards to PC makers. Logitech plans to reduce its overall cost structure by slashing product, overhead and infrastructure costs. Going forward, the company expects to focus on making selective investments to ensure disciplined cost management in the coming quarters.
The company is now focused on retail and online sales of accessories, which are turning out to be real profit churners. Encouragingly, the company is focused on venturing into new businesses and over the past three years, it has grown successful businesses, including Bluetooth Speakers and Video Collaboration via advanced offerings.
Presently, most of the company’s businesses including, Audio-PC & Wearables and Mobile Speakers, Video Collaboration, Retail and cloud-based video conferencing services, have been largely supplementing the top line. One of the company’s most notable collaborations, with technology behemoth – Apple Inc. (AAPL - Free Report) – is proving conducive to the growth of Tablet & Other Accessories segment. Also, gaming business is proving to be a major catalyst, backed by product launches, marketing initiatives and growing trend of PC gaming in the Asia Pacific.
Moving ahead, the company has plans to tap the high potential market for accessories, by pursuing innovation and expanding its product lines. Most of its innovative offerings, like the fastest performing mouse and keyboard switches, have been enjoying an impressive traction, pumping revenues. The Zacks Rank #3 (Hold) company is planning a range of product launches in the coming quarters, to reinforce its foothold in the market.
Stocks to Consider
Better-ranked stocks in the same space include Identiv Inc. (INVE - Free Report) and Mercury Systems, Inc. (MRCY - Free Report) , both holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Identiv recently broke its streak of missing earnings estimates, as it surpassed estimates by an impressive 64.3% in the last reported quarter.
Mercury Systems has three beats over the trailing four quarters and boasts an average positive surprise of 79.1%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>