Is chipmaker Astera Labs among the next big AI stock winners? Astera's profit growth rate went from zero four quarters ago to 218% last quarter. Its sales growth rate shot up from 60% four quarters ago to 619% last quarter.
Astera Labs went public at the end of March. It began forming its first major post-IPO base and shares fell to 36.22 on Aug. 7. It reversed from there and started climbing the right side of what looks like it could be a cup base. Its stock traded at about 66 Wednesday afternoon, an 82% surge in 2-1/2 months.
Astera Labs Rising Toward All-Time High
It has room to grow too. It's rising toward its all-time intraday high 95.21 set on March 26, shortly after it launched its IPO.
On Wednesday, the stock Relative Strength (RS) Rating for Astera rose to 73, up from 69 the day before. History shows that the best stocks often have an 80 or higher RS Rating as they begin their biggest price moves. See if Astera Labs can continue to show renewed price strength and clear that threshold.
Astera Labs offers a platform for companies to connect their artificial intelligence chips, software and hardware. On its website the company says, "The Intelligent Connectivity Platform provides hyperscaler customers with the ability to deploy and operate high-performance AI and cloud infrastructure, addressing an increasingly diverse set of requirements."
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Although it's newly public, the tech company already has high ratings based on its rapid sales and profit growth. Astera has an 80 EPS Rating out of 99, and an 85 Composite Rating. The 85 Composite shows that Astera stock is in the top 15% of all stocks overall, based on a group of fundamental and technical metrics.
Additionally, Astera stock has an A Accumulation/Distribution Rating on an A+ to E scale with A+ tops. The A rating shows that mutual funds, ETFs and other big funds are eager buyers of its stock.
Earnings Due On Nov. 4
Santa Clara, Calif.-based Astera Labs in its latest quarter reversed from an 11-cent per share loss the same quarter a year ago to a 13-cent profit, according to MarketSurge data. That ostensibly is a 218% growth rate. Revenue for its most recent quarter popped 619% to $76.9 million. The company says on its website that it will release third quarter results after the close on Nov. 4.
Astera Labs earns the No. 8 rank among its peers in the 39-stock Electronics-Semiconductor Fabless industry group. Broadcom, Nvidia and Arm Holdings are among the top 5 highly rated stocks in the group.
IBD's proprietary RS Rating measures technical performance by showing how a stock's price action over the last 52 weeks measures up against that of the other stocks in our database.
Please follow James DeTar on X, formerly known as Twitter, @JimDeTar
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