Should You Think About Buying Cirrus Logic, Inc. (NASDAQ:CRUS) Now?

NASDAQ:CRUS), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$74.49 at one point, and dropping to the lows of US$56.96. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Cirrus Logic’s current trading price of US$59.40 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Cirrus Logic’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.” data-reactid=”28″>Cirrus Logic, Inc. (NASDAQ:CRUS), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$74.49 at one point, and dropping to the lows of US$56.96. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Cirrus Logic’s current trading price of US$59.40 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Cirrus Logic’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Cirrus Logic ” data-reactid=”29″> See our latest analysis for Cirrus Logic

What’s the opportunity in Cirrus Logic?

Great news for investors – Cirrus Logic is still trading at a fairly cheap price according to my price multiple model, where I compare the company’s price-to-earnings ratio to the industry average. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 19.99x is currently well-below the industry average of 36.83x, meaning that it is trading at a cheaper price relative to its peers. Cirrus Logic’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its industry peers, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

Can we expect growth from Cirrus Logic?

More

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with an extremely negative double-digit change in profit expected next year, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Cirrus Logic, at least in the near future.

What this means for you:

1 warning sign we think you should be aware of.” data-reactid=”53″>With this in mind, we wouldn’t consider investing in a stock unless we had a thorough understanding of the risks. For example – Cirrus Logic has 1 warning sign we think you should be aware of.

50 other stocks with a high growth potential.” data-reactid=”54″>If you are no longer interested in Cirrus Logic, you can use our free platform to see our list of over 50 other stocks with a high growth potential.