In the latest trading session, Cypress Semiconductor (CY) closed at $13.90, marking a +0.43% move from the previous day. The stock lagged the S&P 500’s daily gain of 0.82%. Elsewhere, the Dow gained 0.79%, while the tech-heavy Nasdaq added 0.79%.
Heading into today, shares of the chipmaker had gained 1.39% over the past month, lagging the Computer and Technology sector’s gain of 2.95% and the S&P 500’s gain of 3.94% in that time.
Wall Street will be looking for positivity from CY as it approaches its next earnings report date. This is expected to be February 7, 2019. In that report, analysts expect CY to post earnings of $0.33 per share. This would mark year-over-year growth of 17.86%. Our most recent consensus estimate is calling for quarterly revenue of $599.37 million, up 0.3% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.34 per share and revenue of $2.48 billion. These totals would mark changes of +50.56% and +6.49%, respectively, from last year.
Any recent changes to analyst estimates for CY should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. CY is currently a Zacks Rank #5 (Strong Sell).
In terms of valuation, CY is currently trading at a Forward P/E ratio of 10.37. For comparison, its industry has an average Forward P/E of 13.14, which means CY is trading at a discount to the group.
Also, we should mention that CY has a PEG ratio of 0.88. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Semiconductor – Communications industry currently had an average PEG ratio of 1.32 as of yesterday’s close.
The Semiconductor – Communications industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 231, which puts it in the bottom 10% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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