Cirrus Logic shares heading higher than $25, analyst says

Apr 28, 2014
Austin Business Journal

Market watchers will be looking to see how shares of Cirrus Logic Inc. react on Monday morning after the shares jumped sharply on Thursday following strong results by Apple Inc., and then again on Friday after company officials raised earnings' estimates and an analyst reported he was bullish on the stock


The possible change in sentiment comes at an interesting juncture, considering shares of Austin-based Cirrus Logic have faced a roller coaster ride in recent months


Cirrus Logic (Nasdaq: CRUS), founded in 1984, develops integrated circuits for products such as smartphones, tablets and other electronic devices and counts Apple Inc. (Nasdaq: AAPL) as its major customer, accounting for 80 percent of its revenue. The company employs about 652 workers


The Motley Fool investment website reported that Tom Sepenzis, an analyst with Northland Capital Markets, on Friday boosted his share price target from $22 to $27, and raised his earnings outlook on Cirrus from $1.63 to $1.78 for 2014


The big surge in Cirrus Logic shares began on Thursday, when the shares closed up more than 7 percent to $20.63 after Apple (Nasdaq: AAPL) said it had sold 43.7 million iPhones in its fiscal second quarter. Considering Cirrus Logic makes the chips contained in iPhones, investors suddenly turned their attention toward the Austin company


Late Thursday after the markets closed, Cirrus Logic released its fiscal year fourth quarter results, beating analysts' estimates and prompting Sepenzis to issue his positive report on the stock. Though Cirrus reported a profit of only 20 cents a share for its GAAP earnings, the company reported non-GAAP earnings of 41 cents a share, handily beating analysts' estimates of 32 cents. The company also said it expected revenue for the first quarter of fiscal 2015 to be between $135 million and $155 million


On Friday, Cirrus Logic shares gained $1, or 4.8 percent, in heavy volume to close out the week at $21.63. The shares hit bottom on Feb. 3 at $17.01 and have since made a gradual recovery, but are still off the 52-week high of $25.91 last October


Print Article opens in new window