Key Factors
Cirrus Logic’s shares lagged behind these of its larger friends final yr, however that is set to alter. 
This week’s earnings have caught buyers unexpectedly in the very best method. 
Already, the inventory is monitoring in direction of final yr’s all-time excessive and appears good worth to maintain on going. 
5 shares we like higher than Cirrus Logic
With a lot of the discuss round semiconductor shares dominated by the likes of NVIDIA Corp NASDAQ: NVDA, Superior Micro Dynamics NASDAQ: AMD, and the like, it is simple to assume there aren’t that many smaller-cap chip shares floating about. Nonetheless, even with a market cap of lower than $5 billion, in comparison with NVIDIA’s $1.7 trillion, Cirrus Logic, Inc. NASDAQ: CRUS can nonetheless pack a punch. 
It rode the unreal intelligence (AI) impressed growth in chip shares a yr in the past however then underperformed lots of its larger friends by means of the autumn. An end-of-year rally to the tune of 30% confirmed the potential it had, and this can be a theme that is been constructed on with yesterday’s 15% bounce. Get Cirrus Logic alerts:Signal Up
The newest catalyst for the transfer greater was the corporate’s fiscal Q3 earnings, which had been launched on Tuesday night. Cirrus managed to beat analyst expectations for each headline numbers, with income coming in at a report excessive alongside its best-ever EPS print of $2.57. 
Bullish outlook
Past the beat on the massive numbers, the corporate’s ahead steerage additionally got here in sizzling, which itself could be a main driver of upward momentum in share worth. It successfully says that the market has been undervaluing a inventory based mostly on future expectations which have now been raised by the enterprise itself. It is one of the crucial bullish alerts an organization can provide, and it is no shock that buyers have been impressed by it. 
They’ve additionally been impressed by what they’re seeing as the next degree of execution from senior management. Beginning off 2024 with the best income and EPS print is strictly what buyers would have been on the lookout for, and it bodes properly for Cirrus’ prospects within the months forward. Important milestones had been ticked off with regard to the manufacturing of next-generation audio parts, whereas the corporate additionally made notable progress in its course of know-how and foundry technique.  
It additionally noticed sturdy buyer engagement with its laptop computer options and superior a number of R&D applications within the high-performance mixed-signal enterprise. CEO John Forsyth pointed to all these and emphasised the corporate’s strong product roadmap, which he sees pushing shares on to additional positive aspects by means of 2024 and past. 
Earlier considerations across the firm’s dependence on Apple Inc NASDAQ: AAPL, who as a buyer has been accountable for upwards of 80% of Cirrus’ income, are persevering with to dissipate, with Forsyth opening up extra Android-focused income channels and diversifying the corporate’s general turnover. 
Excessive expectations
So, simply how far can Cirrus rally from right here? Properly, the previous few days have seen a number of main upgrades from analysts, who’ve been boosting their worth targets accordingly. Susquehanna and TD Cowen, for instance, each got here out bullish on the inventory, every giving it a recent worth goal of $100. Even together with yesterday’s pop, that is nonetheless pointing to an additional upside of greater than 10%. Had been Cirrus shares in a position to hit that within the coming weeks, they’d be inside touching distance of final April’s all-time excessive, and also you’d should be considering they’d be good worth to maintain on going. 
The chance-on sentiment sweeping equities proper now is simply too good to be ignored, due largely to the rising consensus that the Fed has managed a comfortable touchdown. Inflation readings are persevering with to chill, and expectations for an finish to charge hikes, and perhaps even a lower, are rising. Whereas the relative power index (RSI) for Cirrus’ shares is studying 70, suggesting the inventory is overbought, it is nowhere close to excessive sufficient to be a trigger for concern proper now.
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