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Bull Of The Day: Logitech (LOGI)

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Logitech International (LOGI - Free Report) is a Zacks Rank #1 (Strong Buy) and carries a grwoth style score of B along with a value style score of C.  I like this stock here as the China trade deal is probably coming in the next month or so and that could be a big tailwind for this company.  Today, LOGI is the Bull of the Day.

Description

Logitech designs, manufactures and markets innovative peripherals that provide people with easy access to the digital world. The Company's product family includes Internet video cameras, mice and trackballs, keyboards, audio and telephony products, interactive gaming devices and 3D controllers.

Earnings History

I see a solid earnings history for LOGI.  The company has topped the Zacks Consensus Estimate in each of the last four quarters.  The most recent quarter saw a beat of 12 cents for an 18% positive earnings surprise.

In fact, the average positive earnings surprise over the last four quarters is right at 18.3%. 

Estimates Tick HIgher

The key to the Zacks Rank is the move in earnings estimates.  With a Zacks Rank #1 (Strong Buy) we know that estimates are moving higher.  That is the case for LOGI, with the fiscal 2019 number moving from $1.86 90 days ago to $1.95.

The 2020 fiscal number has also bumped higher, moving from $2.07 to $2.12 over the same time horizon.

Valuation

I see a good valuation here too, with a 19x forward PE multiple.  Revenue growth on an annual basis is only 6%, but with margin improvement that could translate into much higher earnings estimates.  A deal with China that provides more leverage for this company could easily help investors boost the multiple for this stock.

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