On Wednesday, TD Cowen maintained a Buy rating on Cirrus Logic (NASDAQ:CRUS) and raised the stock's price target to $115 from $100. The firm's assessment follows Cirrus Logic's performance which surpassed the typically soft seasonal results for the March quarter. The company reported results that were significantly higher than anticipated, driven by robust mobile shipments to Apple (NASDAQ:AAPL), which accounts for 86% of Cirrus Logic's revenue.
The positive outlook aligns with Cirrus Logic's guidance for the June quarter, which also exceeds market consensus. TD Cowen's commentary highlighted the company's successful delivery in the March quarter and its promising future prospects. The firm specifically pointed out the potential of the 22nm codec and new amplifier products that are expected to ramp up in the second half of fiscal year 2025, corresponding to the second half of calendar year 2024.
Cirrus Logic's long-term opportunities in notebook audio and power markets were also noted as contributing factors to the maintained Buy rating. The company's strategic moves in these areas are seen as positive steps that could bolster its market position and financial performance in the coming years.
The analyst from TD Cowen expressed confidence in the stock, stating that the positive commentary around Cirrus Logic's product developments and market opportunities remains strong. This sentiment is reflected in the decision to adjust the price target to $115 while keeping the Buy rating unchanged.
The increase in the price target for Cirrus Logic indicates a favorable view of the company's current performance and its potential for future growth. The company's association with Apple and its expansion into new product areas are key elements that support the analyst's optimistic outlook for Cirrus Logic's stock.
InvestingPro Insights
Following the positive sentiment from TD Cowen, Cirrus Logic (NASDAQ:CRUS) continues to show promising signs according to recent data and analysis from InvestingPro. The company's strategic share buybacks, as indicated by an InvestingPro Tip, suggest management's confidence in the company's value. Additionally, the company's financial health is highlighted by its strong cash position relative to debt and its ability to cover interest payments comfortably.
InvestingPro Data reveals a market capitalization of $5.42 billion and a Price to Earnings (P/E) ratio of 19.88, which adjusts to 20.74 on a last twelve months basis as of Q3 2024. This is coupled with a robust gross profit margin of 50.83% over the same period. Despite a slight decline in revenue growth year-over-year, the company has experienced a significant price increase of 26.52% over the last six months, trading near its 52-week high at 97.23% of the peak value.
Investors interested in a deeper dive into Cirrus Logic's potential can explore additional InvestingPro Tips that provide a comprehensive analysis of the company's performance and prospects. There are 11 more tips available on InvestingPro, including insights on sales predictions, profitability, and dividend policies. For those looking to enhance their investment strategies, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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