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Bull of the Day: Cirrus Logic (CRUS)

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Cirrus Logic (CRUS - Free Report) is a Zacks Rank #1 (Strong Buy) that has a C for Value and a D for Growth. This company is a fabless semiconductor supplier and the chip sector remains very hot.  The Zacks Style Score for Value is only a C, but I think that grade is rather low as most of the metrics investors typically look to are very good. Let’s learn more about why this stock is the Bull of the Day.

Description                                              

Cirrus Logic, Inc. engages in the development of mixed-signal processing solutions. Its product lines include audio and High-Performance Mixed-Signal (HPMS) products. It operates through the following geographical segments: China, Hong Kong, Vietnam, South Korea, India, United States, and Rest of World. The company was founded by Suhas S. Patil and Michael L. Hackworth in 1984 and is headquartered in Austin, TX.

Earnings History                                                         

When I look at a stock, the first thing I do is look to see if the company is beating the number.  This tells me right away where the market’s expectations have been for the company and how management has communicated to the market.  A stock that consistently beats has management communicating expectations to Wall Street that can be achieved.  That is what you want to see.

Cirrus Logic (CRUS - Free Report) has topped the Zacks Consensus Estimate in each of the last four quarters. The company most recently posted EPS of $2.83 per shar when the Zacks Consensus Estimate was calling for $2.40.  That 43 cent beat translates into a 17.9% positive earnings surprise.

Over the last four quarters the average positive surprise works out to be 31%.

Earnings Estimates Revisions

Earnings estimate revisions is what the Zacks Rank is all about. 

Estimates are moving higher for Cirrus Logic (CRUS - Free Report) .

The full year 2025 has increased from $7.07 to $7.73 over the last 60 days.

2026 has increased from $7.05 to $7.32 over the same time period.

Valuation                                                                                                        

The valuation for Cirrus Logic (CRUS - Free Report) is interesting given the growth prospects. Forward earnings multiple of 15.5x is pretty low due to the fact that this fiscal year revenue is projected to contract by 1.65%.  Next fiscal year the company is expected to see revenue growth of 1.2%.  The price to book multiple comes in just a hair over 3x and that is the level that will keep value investors interested in this stock.

Operating margins have increased from 17.9% to 18.5% to 19.8% over the last three quarters.  


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