Texas-based Cirrus Logic just turned a corner, reporting a solid profit gain, up 20%, and a return to revenue growth. The question is: Can it maintain that renewed momentum this year? On Wednesday the chipmaker got backing for views its recent rebound will continue as the Relative Strength (RS) Rating for Cirrus Logic stock climbed from 69 to 72.
Cirrus Logic Stock Get Vote Of Confidence From Investors
The Street also gave a vote of confidence for Cirrus Logic stock prospects as it gapped up nearly 15% on Feb. 7, the day after the company reported fiscal third quarter results.
Like other chipmakers, with a few exceptions like AI-leader Nvidia, Cirrus Logic struggled last year. But after three quarters of shrinking profits it reversed hard to a 20% year-over-year gain to $2.89 per share. In like manner, its sales shrank for three quarters until its Feb. 6 Q3 report when it said revenue grew 5% to a record $619 million.
The upgraded 73 Relative Strength Rating means that Cirrus Logic stock beats more than 70% of all stocks for price performance over the past year.
Over 100 years of market history reveals that the market's biggest winners tend to have an RS Rating of at least 80 as they launch their biggest price moves. See if Cirrus Logic can continue to show renewed price strength and hit that benchmark.
Its other ratings are even brighter. Cirrus Logic boasts a 90 Earnings Per Share Rating, putting it in the top 10% of companies for profit growth in recent years with emphasis on the two most recent quarters.
It also has an 89 Composite Rating, a gauge of fundamental and technical strength. Backing that up, it earns a strong B grade on both its SMR Rating (sales + profit margins + return on equity) and its Accumulation/Distribution Rating.
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Forming Cup With Handle
Cirrus Logic makes analog and mixed-signal chips and software used in a variety of electronic devices including headsets and audio devices for autos and in-home systems, as well as noise-canceling and voice-capture applications.
Cirrus Logic is building a cup with handle with a 95.87 buy point. See if the stock can clear the breakout price in heavy trade.
Taking a look at revenue and profit performance, Cirrus Logic has posted three quarters of improving earnings as it moved toward profit growth last quarter. Top line results also improved during the same period.
Cirrus Logic stock earns the No. 7 rank among its peers in the 38-stock Electronics-Semiconductor Fabless industry group. Arm Holdings and Nvidia are also among the group's highest-rated stocks. The group overall gets a terrific A+ Group Relative Strength Rating.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.
The exclusive Relative Strength Rating from Investor's Business Daily measures share price action with a 1 (worst) to 99 (best) score. The score shows how a stock's price performance over the trailing 52 weeks holds up against all the other stocks in our database.
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