Street Fight: Analysts diverge on Apple supplier Cirrus after results

Both KeyBanc and Needham raised their price targets for Cirrus Logic following earnings while BofA cut its rating
Shares of Cirrus Logic (CRUS) are under pressure on Thursday despite the company posting better-than-expected first quarter results, with both earnings per share and revenue beating consensus estimates. Following the news, Craig-Hallum analyst Anthony Ross upgraded the stock to Buy, saying the company guided well above second quarter estimates and citing strength at Apple (AAPL), one of Cirrus’ major customers. On the flip side, his peer at Bank of America downgraded Cirrus Logic to Neutral on the view that the company’s announcement of full year 2023 pricing and cost pressures suggests earnings growth is likely to remain muted and below semis industry growth.

RESULTS: Cirrus Logic reported first quarter earnings per share of 54c and revenue of $277.3M, both better the expected 40c and $261.76M, respectively. “In the past quarter, Cirrus Logic accelerated both sales momentum and execution of our growth strategy. We grew revenue by 14 percent year on year, increased penetration of the Android market, began shipments with a leading laptop OEM, ramped new content in anticipation of product launches in the latter half of the year and advanced the development of a number of new components that are expected to drive future revenue growth,” said John Forsyth, Cirrus Logic president and chief executive officer. “The company’s recent investments in power-related products, including the acquisition of Lion Semiconductor, are expected to meaningfully expand our addressable market and continue the exciting progress we have been making in building new and strategic areas of our business. With a strong pipeline of audio and high-performance mixed-signal products ramping in the coming months, we are upbeat about the next several quarters and continue to anticipate accelerated revenue growth in FY22.” For the second quarter, Cirrus Logic sees revenue of $430M-$470M, with consensus at $385.86M.
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