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Alpha and Omega Semiconductor (AOSL) Gains But Lags Market: What You Should Know

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Alpha and Omega Semiconductor (AOSL - Free Report) closed at $53.46 in the latest trading session, marking a +0.49% move from the prior day. This change lagged the S&P 500's 0.81% gain on the day. At the same time, the Dow added 0.3%, and the tech-heavy Nasdaq gained 0.37%.

Heading into today, shares of the chipmaker had gained 13.38% over the past month, outpacing the Computer and Technology sector's gain of 4.13% and the S&P 500's gain of 5.64% in that time.

Investors will be hoping for strength from Alpha and Omega Semiconductor as it approaches its next earnings release. On that day, Alpha and Omega Semiconductor is projected to report earnings of $1.18 per share, which would represent year-over-year growth of 53.25%. Meanwhile, our latest consensus estimate is calling for revenue of $194 million, up 14.65% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.60 per share and revenue of $772.7 million. These totals would mark changes of +57% and +17.63%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Alpha and Omega Semiconductor. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Alpha and Omega Semiconductor is holding a Zacks Rank of #2 (Buy) right now.

In terms of valuation, Alpha and Omega Semiconductor is currently trading at a Forward P/E ratio of 11.56. Its industry sports an average Forward P/E of 21.09, so we one might conclude that Alpha and Omega Semiconductor is trading at a discount comparatively.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 87, which puts it in the top 35% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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