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Strength Seen in Cirrus Logic (CRUS): Can Its 16.5% Jump Turn into More Strength?

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Cirrus Logic (CRUS - Free Report) shares rallied 16.5% in the last trading session to close at $90.23. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 23.9% loss over the past four weeks.

The increase in share price can be attributed to President Trump’s announcement of a 90-day suspension on reciprocal tariffs, with China excluded. This news triggered a sharp jump in market indices, lifting the prices of many stocks, including Cirrus Logic.

In addition to that, various company-specific factors are also playing a key role in driving the stock’s performance. Growing momentum in the laptop market and increasing win designs with customers on next-generation flagship smartphones are propelling the company’s growth trajectory.

Strong demand for its latest custom-boosted amplifier and 22nm smart codec is driving growth. Partnerships with Intel and other top OEMs are boosting its presence in the laptop market. The ongoing share buyback program also highlights the company’s confidence and commitment to shareholder value.

This chipmaker is expected to post quarterly earnings of $1.15 per share in its upcoming report, which represents a year-over-year change of -7.3%. Revenues are expected to be $379.99 million, up 2.2% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Cirrus Logic, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on CRUS going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Cirrus Logic is a member of the Zacks Electronics - Semiconductors industry. One other stock in the same industry, Allegro MicroSystems, Inc. (ALGM - Free Report) , finished the last trading session 22.7% higher at $23.23. ALGM has returned -25.7% over the past month.

For Allegro MicroSystems, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.05. This represents a change of -80% from what the company reported a year ago. Allegro MicroSystems currently has a Zacks Rank of #3 (Hold).


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