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American Superconductor Corporation (AMSC) Soars to 52-Week High, Time to Cash Out?
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Shares of American Superconductor (AMSC - Free Report) have been strong performers lately, with the stock up 55.4% over the past month. The stock hit a new 52-week high of $21.19 in the previous session. American Superconductor has gained 88.8% since the start of the year compared to the 16.9% move for the Zacks Computer and Technology sector and the 4.7% return for the Zacks Electronics - Miscellaneous Components industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 29, 2024, American Superconductor reported EPS of $0.05 versus consensus estimate of $-0.03 while it beat the consensus revenue estimate by 14.36%.
For the current fiscal year, American Superconductor is expected to post earnings of $0.09 per share on $159.25 million in revenues. This represents a 400% change in EPS on a 9.35% change in revenues. For the next fiscal year, the company is expected to earn $0.32 per share on $176.55 million in revenues. This represents a year-over-year change of 230% and 10.86%, respectively.
Valuation Metrics
American Superconductor may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
American Superconductor has a Value Score of F. The stock's Growth and Momentum Scores are A and A, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 221.4X current fiscal year EPS estimates, which is a premium to the peer industry average of 24.3X. On a trailing cash flow basis, the stock currently trades at 1396.1X versus its peer group's average of 14.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, American Superconductor currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if American Superconductor fits the bill. Thus, it seems as though American Superconductor shares could still be poised for more gains ahead.
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American Superconductor Corporation (AMSC) Soars to 52-Week High, Time to Cash Out?
Shares of American Superconductor (AMSC - Free Report) have been strong performers lately, with the stock up 55.4% over the past month. The stock hit a new 52-week high of $21.19 in the previous session. American Superconductor has gained 88.8% since the start of the year compared to the 16.9% move for the Zacks Computer and Technology sector and the 4.7% return for the Zacks Electronics - Miscellaneous Components industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 29, 2024, American Superconductor reported EPS of $0.05 versus consensus estimate of $-0.03 while it beat the consensus revenue estimate by 14.36%.
For the current fiscal year, American Superconductor is expected to post earnings of $0.09 per share on $159.25 million in revenues. This represents a 400% change in EPS on a 9.35% change in revenues. For the next fiscal year, the company is expected to earn $0.32 per share on $176.55 million in revenues. This represents a year-over-year change of 230% and 10.86%, respectively.
Valuation Metrics
American Superconductor may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
American Superconductor has a Value Score of F. The stock's Growth and Momentum Scores are A and A, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 221.4X current fiscal year EPS estimates, which is a premium to the peer industry average of 24.3X. On a trailing cash flow basis, the stock currently trades at 1396.1X versus its peer group's average of 14.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, American Superconductor currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if American Superconductor fits the bill. Thus, it seems as though American Superconductor shares could still be poised for more gains ahead.