Cirrus Logic (CRUS): Is the Recent Share Price Pullback Creating a Valuation Opportunity?

Cirrus Logic (CRUS) has been quietly recalibrating after a choppy month, with the stock slipping about 6% even as its past 3 months and year-to-date returns remain solidly positive.

See our latest analysis for Cirrus Logic.

With the share price now at $122.15, Cirrus Logic’s recent 30 day share price pullback sits against a stronger backdrop of a 90 day share price gain and robust multi year total shareholder returns, suggesting momentum is pausing rather than breaking.

If this kind of earnings sensitive move has your attention, it could be a good moment to scan the broader chip space and see what other high growth tech and AI stocks are setting up interesting risk reward profiles.

Yet with revenue growth flattening, earnings dipping, and the stock trading below consensus targets but above some intrinsic value estimates, investors face a familiar question: Is Cirrus Logic underestimated here, or is future growth already baked in?

Most Popular Narrative Narrative: 13% Undervalued

With Cirrus Logic last closing at $122.15 against a most followed fair value of $140, the narrative leans toward upside anchored in selective growth drivers.

The company's engagement with leading laptop OEMs and the ramp up of next generation PC audio components reflect early but growing traction in non mobile applications. As these designs move from sampling to mainstream adoption, especially across multiple price tiers and high volume devices, Cirrus Logic stands to significantly expand its addressable market, supporting sustained top line growth and long term margin expansion.

Read the complete narrative.

Want to see what powers that optimistic fair value? The narrative leans on shrinking margins, flat revenues, and a bold future earnings multiple. Curious?

Result: Fair Value of $140 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, heavy reliance on a handful of smartphone customers and uncertain scaling in newer markets could easily derail that upbeat, undervalued narrative.

Find out about the key risks to this Cirrus Logic narrative.

Another Way to Look at Value

While the popular narrative sees Cirrus Logic as about 13% undervalued versus a $140 fair value, our DCF model points the other way, with a fair value closer to $92.84, implying the stock is trading rich. Which future path do you think is more realistic?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Cirrus Logic for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 918 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Cirrus Logic Narrative

If you see the story differently or want to dive into the numbers yourself, you can shape a personalized view in just a few minutes: Do it your way.

A great starting point for your Cirrus Logic research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.