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Cirrus Logic (CRUS) Surges 37.1% YTD: Will the Trend Continue?
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Cirrus Logic (CRUS - Free Report) witnessed healthy momentum this year so far. Shares of the company have gained 37.1% in the same time frame compared with the sub-industry’s growth of 16.3%.
Cirrus Logic is a fabless semiconductor supplier that develops low-power, high-precision mixed-signal processing solutions. The company focuses on expanding markets where it can apply its high-precision, low-power mixed-signal processing knowledge to address challenging issues across the analog-to-digital divide.
Image Source: Zacks Investment Research
Catalysts Behind the Price Surge
Let’s delve deeper to unearth the factors working in favor of this Zacks Rank #3 (Hold) stock.
The company’s performance is benefiting from the rapid adoption of its product portfolio. In the fourth quarter of fiscal 2024, a leading Android OEM introduced their latest flagship smartphone featuring a Cirrus Logic boosted amplifier and a haptic driver. The company also continues to win designs with customers on next-generation flagship smartphones with its general market audio components.
The company plans to make investments in the advanced battery and power technology market related to high-efficiency charging, battery management, and system-side power delivery. Apart from this, the company plans to launch its next-generation custom-boosted amplifier and its first 22-nanometer smart codec later in fall 2024.
These new products will significantly improve performance improvements over prior generations. Owing to these factors, the company expects High-Performance Mixed-Signal and Audio SAM to cross $5.7 and $3.3 billion by 2028.
The company has enhanced shareholders’ wealth through share repurchases. The company repurchased 548,000 shares worth $50 million in the fiscal fourth quarter. In fiscal 2024, it bought back shares worth $186 million. As of Mar 30, 2024, it had $315.1 million worth of shares remaining under its existing share repurchase authorization.
Apart from its solid fundamentals, the company is affected due to a reduction of general market and custom components, especially in non-smartphone applications. Stiff competition, customer concentration risk and unfavorable foreign currency movement amid uncertain macroeconomic conditions are headwinds.
Stable Solvency Structure
Cirrus Logic is a cash-rich company with a strong balance sheet. As of Mar 31, 2024, the company had cash and cash equivalents and marketable securities of $526.5 million with no long-term debt. Since it has net cash available on its balance sheet, the existing cash can be used for pursuing strategic acquisitions, investment in growth initiatives and distribution to shareholders.
In the fiscal fourth quarter, the company reported $170.5 million of cash flow from operations. In the prior-year quarter, it generated $48.3 million of net cash from operations. Free cash flow was $162.8 million.
The Zacks Consensus Estimate for Woodward’s fiscal 2024 earnings per share (EPS) has moved up 11.1% in the past 60 days to $5.86. WWD’s long-term earnings growth rate is 16.3%.
Woodward’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 26.1%. WWD shares have risen 62% in the past year.
The Zacks Consensus Estimate for ANET’s 2024 EPS has increased 6.2% in the past 60 days to $7.92. ANET’s long-term earnings growth rate is 15.7%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average earnings surprise of 15.4%. Shares of ANET have gained 127.3% in the past year.
The Zacks Consensus Estimate for Super Micro Computer’s fiscal 2024 EPS has improved 8.3% in the past 60 days to $23.51. SMCI’s long-term earnings growth rate is 52.3%.
SMCI’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.9%. Shares of SMCI have risen 481% in the past year.
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Cirrus Logic (CRUS) Surges 37.1% YTD: Will the Trend Continue?
Cirrus Logic (CRUS - Free Report) witnessed healthy momentum this year so far. Shares of the company have gained 37.1% in the same time frame compared with the sub-industry’s growth of 16.3%.
Cirrus Logic is a fabless semiconductor supplier that develops low-power, high-precision mixed-signal processing solutions. The company focuses on expanding markets where it can apply its high-precision, low-power mixed-signal processing knowledge to address challenging issues across the analog-to-digital divide.
Image Source: Zacks Investment Research
Catalysts Behind the Price Surge
Let’s delve deeper to unearth the factors working in favor of this Zacks Rank #3 (Hold) stock.
The company’s performance is benefiting from the rapid adoption of its product portfolio. In the fourth quarter of fiscal 2024, a leading Android OEM introduced their latest flagship smartphone featuring a Cirrus Logic boosted amplifier and a haptic driver. The company also continues to win designs with customers on next-generation flagship smartphones with its general market audio components.
The company plans to make investments in the advanced battery and power technology market related to high-efficiency charging, battery management, and system-side power delivery. Apart from this, the company plans to launch its next-generation custom-boosted amplifier and its first 22-nanometer smart codec later in fall 2024.
These new products will significantly improve performance improvements over prior generations. Owing to these factors, the company expects High-Performance Mixed-Signal and Audio SAM to cross $5.7 and $3.3 billion by 2028.
The company has enhanced shareholders’ wealth through share repurchases. The company repurchased 548,000 shares worth $50 million in the fiscal fourth quarter. In fiscal 2024, it bought back shares worth $186 million. As of Mar 30, 2024, it had $315.1 million worth of shares remaining under its existing share repurchase authorization.
Apart from its solid fundamentals, the company is affected due to a reduction of general market and custom components, especially in non-smartphone applications. Stiff competition, customer concentration risk and unfavorable foreign currency movement amid uncertain macroeconomic conditions are headwinds.
Stable Solvency Structure
Cirrus Logic is a cash-rich company with a strong balance sheet. As of Mar 31, 2024, the company had cash and cash equivalents and marketable securities of $526.5 million with no long-term debt. Since it has net cash available on its balance sheet, the existing cash can be used for pursuing strategic acquisitions, investment in growth initiatives and distribution to shareholders.
In the fiscal fourth quarter, the company reported $170.5 million of cash flow from operations. In the prior-year quarter, it generated $48.3 million of net cash from operations. Free cash flow was $162.8 million.
Stocks to Consider
Some better-ranked stocks from the broader technology space are Woodward (WWD - Free Report) , Arista Networks (ANET - Free Report) and Super Micro Computer (SMCI - Free Report) . Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Woodward’s fiscal 2024 earnings per share (EPS) has moved up 11.1% in the past 60 days to $5.86. WWD’s long-term earnings growth rate is 16.3%.
Woodward’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 26.1%. WWD shares have risen 62% in the past year.
The Zacks Consensus Estimate for ANET’s 2024 EPS has increased 6.2% in the past 60 days to $7.92. ANET’s long-term earnings growth rate is 15.7%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average earnings surprise of 15.4%. Shares of ANET have gained 127.3% in the past year.
The Zacks Consensus Estimate for Super Micro Computer’s fiscal 2024 EPS has improved 8.3% in the past 60 days to $23.51. SMCI’s long-term earnings growth rate is 52.3%.
SMCI’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.9%. Shares of SMCI have risen 481% in the past year.