Shares of audio mixed-signal chipmaker Cirrus Logic (NASDAQ: CRUS) were rising on Tuesday, up as much as 6.3% at one point before pulling back to a 4.1% gain as of 2:30 p.m. ET. Cirrus rose on the back of a positive analyst note, which had good news for this smartphone-related chipmaker, as well as others.
In a research note published today, Keybanc analyst John Vinh raised his price target on Cirrus to $155, up from a prior target of $120.
The price-target increase comes from Vinh’s channel checks showing improving expectations for the Apple iPhone 16 this year, especially after the unveiling of Apple Intelligence last month. Of note, Cirrus is a key chip supplier to Apple. According to Vinh, Cirrus should continue to make the iPhone’s audio chips as it usually does and the iPhone 16’s new camera button may use Cirrus’ haptics driver, as well.
The positive note on Cirrus correlated with other price-target increases for other chip stocks from Keybanc today, including Nvidia. Keybanc’s channel checks continue to show traditional servers are returning to growth, while artificial intelligence (AI) demand continues “unabated.”
Increased AI demand may help Cirrus in an indirect way, as the new Apple Intelligence AI capabilities only work with newer phones. Therefore, the new Apple AI capabilities could spur a wave of phone upgrades. As a reminder, Cirrus Logic is extremely dependent on Apple, with 87% of revenue coming from the smartphone giant last year.
Thus, as new functionality from AI permeates more and more devices, the AI revolution should continue to lift most boats in the semiconductor sector.
Before you buy stock in Cirrus Logic, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Cirrus Logic wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $785,556!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.
*Stock Advisor returns as of July 8, 2024
Billy Duberstein and/or his clients have positions in Apple. The Motley Fool has positions in and recommends Apple and Nvidia. The Motley Fool recommends Cirrus Logic. The Motley Fool has a disclosure policy.
—
Blog powered by G6
Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.
For any inquiries, please contact [email protected]
