Cohu, Inc. (NASDAQ: COHU), a global supplier of equipment and services optimizing semiconductor manufacturing yield and productivity, today announced that management will participate at the following investor conferences:
TD Cowen 54th Annual Technology, Media & Telecom Conference
Location: InterContinental New York Barclay, New York, NY
May 27, 2026
23rd Annual Craig-Hallum Institutional Investor Conference
Location: Depot Renaissance Hotel Minneapolis, MN
May 28, 2026
Stifel 2026 Cross Sector Insight Conference
Location: InterContinental Boston, MA
June 2, 2026
2026 Evercore Global TMT Conference
Location: the Omni San Francisco Hotel in San Francisco, CA
June 3, 2026
Portfolio managers and analysts should contact their respective banking representative to schedule a meeting at these conferences.
Presentation materials will be made concurrently available on the Investor Relations section of the Company’s website, www.cohu.com.
About Cohu:
Cohu (NASDAQ: COHU) was founded in 1947 and is a global technology leader supplying test, automation, inspection & metrology products, software analytics solutions and services to the semiconductor industry. Additional information can be found at www.cohu.com.
For press releases and other information of interest to investors, please visit Cohu’s website at www.cohu.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260518688544/en/
On May 19, 2026, Cohu Inc COHU shares fell 3.2% to a current price of $42.77. The stock has experienced a volatile year, with a 52-week high of $52.43 and a low of $16.46.
GF Value™ verdict: Current price of $42.77 vs GF Value™ of $25.57 indicates the stock is 67.3% overvalued.GF Score™ of 66/100 suggests an above-average rating, indicating potential for long-term returns.Notable signal: Insiders have sold $0.9M worth of shares in the last 3 months, with no buying activity reported. Is COHU Overvalued or Undervalued? The current market price of Cohu Inc COHU significantly exceeds its GF Value™, which is estimated at $25.57. This suggests that the shares are overvalued by 67.3%, indicating a substantial margin of safety for potential investors. The GF Valuation label categorizes COHU as "Significantly Overvalued," which presents a risk for those considering entry points into the stock. While the company's recent performance may seem appealing, the underlying valuation metrics suggest that a correction could be on the horizon.
GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. Given the current valuation, it may be prudent for investors to approach COHU with caution, as the high market price may not be justified by the company's financial fundamentals.
How Does COHU's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 73.9x 17.5x COHU's current P/E ratio of 73.9x is substantially above its 5-year median P/E of 17.5x, indicating that the stock is trading at a premium compared to its historical valuation. This analysis aligns with the GF Value™ verdict of being significantly overvalued, reinforcing the notion that the current price does not reflect the company's historical earning potential.
What Does COHU's GF Score™ Tell Us? Metric Rating GF Score™ 66/100 Financial Strength 6/10 Profitability 4/10 Growth 4/10 Valuation 3/10 Momentum 9/10 The GF Score™ of 66/100 indicates that Cohu Inc COHU is positioned above average relative to its peers, suggesting potential for higher long-term returns. The strongest area is the momentum rank of 9/10, reflecting positive price trends. However, the valuation score of 3/10 raises concerns about its current pricing relative to intrinsic value, emphasizing the need for caution among potential investors.
What Are Insiders Doing with COHU Stock? Recent insider activity shows that insiders have sold $0.9 million worth of shares in the last three months without any recorded buying. This selling pattern may suggest a lack of confidence in the stock's current valuation or future performance, which could be a red flag for potential investors.
The absence of insider buying during this period may indicate that those closest to the company do not see attractive investment opportunities at the current price level.
What This Means for Investors Based on the GF Value™ assessment, Cohu Inc COHU is currently overvalued. With a significant discrepancy between the market price and the estimated intrinsic value, investors may need to exercise caution before entering or increasing their positions in COHU.
For the complete analysis, visit the Cohu Inc COHU stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is COHU's GF Score™?
COHU has a GF Score™ of 66/100, indicating an above-average rating that suggests potential for higher long-term returns based on its performance metrics.
Is COHU overvalued or undervalued?
COHU is currently overvalued, with a GF Value™ of $25.57 compared to its market price of $42.77, suggesting a significant risk for potential investors.
What is COHU's P/E ratio?
COHU's current P/E ratio is 73.9x, which is considerably higher than its 5-year median P/E of 17.5x, indicating that the stock is trading at a premium relative to its historical valuation.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
The semiconductor industry is at the heart of the artificial intelligence (AI) revolution. Without advanced chips and networking components for data centers, developers wouldn't have enough computing capacity to build and deploy AI models. Nvidia, Advanced Micro Devices, and Micron Technology are just a few key suppliers of that hardware.
However, many lesser-known companies operate behind the scenes to supply machines and equipment that make the manufacturing process more efficient. Cohu (COHU +7.53%) is one of them -- its testing and handling systems play a central role in the quality control process, ensuring chips are free of defects before they ship to customers.
Cohu stock has exploded higher by 160% over the last 12 months on soaring demand for its equipment. But all of the analysts tracked by The Wall Street Journal think it's still a buy, and their consensus price target suggests more upside is ahead. Is this the ultimate under-the-radar AI opportunity for investors?
Image source: Getty Images.
Cohu's systems are critical to the manufacturing process Cohu sells equipment to chipmakers for the automotive, computing, mobile, industrial, consumer, and AI markets. The AI opportunity might be the largest in the company's history, and I'll go over some numbers in a moment.
Cohu's Eclipse platform handles the data center chips used in AI workloads, including graphics processing units (GPUs), central processors (CPUs), and high-bandwidth memory (HBM). Eclipse autonomously picks up finished semiconductors post-production and places them in test sockets, where it tests them by simulating real-world operating conditions. Automation is key to this testing process because a manual, human-driven alternative would significantly slow down production.
Then there is the Neon inspection and metrology platform, which closely analyzes the physical condition of memory chips. It uses infrared vision and AI software to identify microscopic cracks, imperfections, and other defects in semiconductor wafers, to ensure they are up to standard before shipping to customers. Neon can spot defects as small as 1 micron -- for some perspective, a human hair is around 70 microns thick.
Cohu is investing heavily in the Neon platform because of how quickly the memory market is moving. Manufacturers like Micron Technology are now shipping HBM4 to AI customers, with HBM5 in the pipeline, and every new generation is more complex than the last. During the first quarter of 2026 (ended March 31), orders soared by 64% year over year in Cohu's inspection and metrology business.
Cohu has a massive order pipeline Wall Street's consensus forecast (provided by Yahoo! Finance) suggests Cohu will deliver $558.5 million in total revenue in 2026, which would be a 23% increase from the prior year. That would mark an acceleration from the 13% growth it delivered in 2025, so the business has significant momentum right now.
But that picture could get even better, because Cohu has a $750 million sales pipeline from what it calls the high-performance computing segment, which includes AI accelerators, GPUs, and HBM-related customers. None of that $750 million has shown up in the company's financial statements yet, because the customers are still in the engagement and qualification phases of the sales process.
That means Cohu's revenue is likely to see a significant boost in the near future.
Should investors buy Cohu stock? The Wall Street Journal tracks seven analysts covering Cohu stock, and all seven have given it a buy rating. They have an average price target of $57.43, implying a potential upside of 24% over the next 12 months or so. The Street-high target of $65 implies an even greater potential gain of 40%.
Today's Change
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7.53
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4.10
Current Price
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58.57
Those returns don't exactly sound explosive for a booming AI semiconductor company, but it's important to remember that Cohu stock is already up 160% over the last 12 months. Therefore, investors who buy the stock today might want to look beyond the next year to maximize their potential returns, and I'll explain why.
Cohu's business isn't consistently profitable, but that appears likely to change thanks to the incredible sales pipeline I highlighted earlier. As a result, Wall Street thinks the company could generate adjusted (non-GAAP) earnings of $0.58 in 2026, placing its stock at a forward price-to-earnings (P/E) ratio of 79.7. For some perspective, that makes the stock three times as expensive as Nvidia, which trades at a forward P/E ratio of 24.1.
However, the Street thinks Cohu could more than double its adjusted earnings to $1.46 per share in 2027, placing its stock at a forward P/E of 31.6. While that still isn't necessarily cheap, the trajectory of the company's earnings could attract a lot of investor interest going forward, particularly if 2028 and 2029 forecasts come in equally strong.
In summary, Wall Street's price targets for Cohu stock are probably achievable, but investors who take a longer-term view of three to five years could reap even greater rewards.
On June 08, 2026, Cohu Inc COHU shares experienced a notable increase of 5.5%, bringing the current price to $52.49. Despite this recent uptick, the stock has shown volatility, with a 52-week trading range of $17.71 to $58.47.
GF Value™ verdict: The current price is $52.49, significantly above the GF Value™ of $25.91, indicating the stock is 102.6% overvalued.GF Score™ is 58/100, suggesting an average performance across key metrics.Notable signal: Insiders have sold $4.2M worth of shares in the last 3 months, indicating a lack of buying interest from those closest to the company. Is COHU Overvalued or Undervalued? The current market price of Cohu Inc COHU stands at $52.49, substantially exceeding the GF Value™ estimate of $25.91. This suggests that the stock is significantly overvalued, with a margin of safety that is notably absent for potential investors. GF Valuation indicates that the stock is "Significantly Overvalued," which raises concerns about its sustainability at this price point. Such overvaluation implies a higher risk for investors, as the stock price may correct itself towards the intrinsic value over time.
GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. In the current scenario, potential investors should exercise caution, considering the elevated valuation against the backdrop of the company's fundamentals and market conditions.
How Does COHU's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 90.1x 17.2x Currently, COHU's P/E ratio of 90.1x is significantly above its 5-year median P/E of 17.2x, indicating that the stock is trading at a much higher valuation compared to its historical averages. This analysis aligns with the GF Value™ verdict, reinforcing the notion that COHU is currently overvalued based on its historical valuation metrics.
What Does COHU's GF Score™ Tell Us? Metric Rating GF Score™ 58 Financial Strength 6/10 Profitability 4/10 Growth 4/10 Valuation 1/10 Momentum 6/10 The GF Score™ of 58/100 reflects average performance across the evaluated metrics. Financial strength is relatively strong at 6/10, suggesting a stable balance sheet, while profitability and growth are weaker at 4/10. Notably, the valuation rank is concerning at 1/10, highlighting the stock's overvaluation risk. Momentum shows a score of 6/10, indicating some positive price action recently, but overall, the mixed scores suggest a cautious outlook for COHU.
What Are Insiders Doing with COHU Stock? In the last three months, insiders have sold a total of $4.2 million worth of COHU shares, with no reported buying activity. This pattern suggests a lack of confidence among those with intimate knowledge of the company's operations and future prospects. The absence of insider buying may further indicate that insiders do not perceive the current stock price as an attractive entry point.
What This Means for Investors Based on the GF Value™ assessment, Cohu Inc COHU is currently overvalued. With a significant disparity between the current stock price and the estimated intrinsic value, potential investors should approach with caution and consider the associated risks.
For the complete analysis, visit the Cohu Inc COHU stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is COHU's GF Score™?
COHU's GF Score™ is 58/100, indicating average performance across the key metrics evaluated.
Is COHU overvalued or undervalued?
COHU is overvalued, with a current price of $52.49 significantly exceeding the GF Value™ estimate of $25.91.
What is COHU's P/E ratio?
COHU's P/E ratio is currently 90.1x, which is markedly above its 5-year median P/E of 17.2x, indicating a high valuation relative to its historical performance.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
The crowd on Polymarket is pricing a 100% probability that SpaceX completes its IPO by June 30, with the offering targeted at $135 per share for a $75 billion raise. If that debut lands as a hit, Tesla (NASDAQ:TSLA) CEO Elon Musk gains a fresh public-equity lever to fund Terafab, the chip-manufacturing megafacility outlined in the SpaceX S-1 filing.
According to the filing, Terafab is a Tesla (March) and Intel (NASDAQ:INTC) (April) collaboration aiming to be the world’s largest chip manufacturing facility, with a long-term goal of one terawatt of annual compute production. Its strategy vertically integrates lithography masks, logic and memory fabrication, and advanced packaging. The catch: per the S-1, specific projects development timelines, milestones and capital expenditures “have not yet been determined.”
A successful SpaceX IPO would unlock a new megafab customer for semiconductor equipment makers, who get paid to outfit fabs regardless of chip prices. Below are five U.S.-listed equipment names ranked by exposure to Terafab’s priorities.
1. ASML (ASML) ASML (NASDAQ:ASML | ASML Price Prediction) sits at the top because Terafab can’t fabricate cutting-edge logic without extreme ultraviolet (EUV) lithography, and ASML is the sole supplier. CEO Christophe Fouquet noted that “the semiconductor industry’s growth outlook continues to solidify, driven by ongoing AI-related infrastructure investments. Demand for chips is outpacing supply.”
ASML’s FY2025 revenue hit $37.94 billion, EUV systems grew 39% to $13.47 billion, and year-end backlog reached a record $45.06 billion. ASML stock has climbed 62% year to date.
The bear case: China export controls and tariffs could clip near-term system sales. The valuation also requires AI capex to stay on its current trajectory into 2027 and beyond.
2. Lam Research (LRCX) Lam Research (NASDAQ:LRCX) supplies etch and deposition tools essential for memory chips, including the high-bandwidth memory (HBM) stacks that AI accelerators consume in bulk. Terafab’s focus on memory fabrication and advanced packaging puts Lam Research directly in line for incremental tool orders.
Lam Research’s Q3 FY2026 revenue hit a record $5.84 billion with non-GAAP EPS of $1.47, and June-quarter guidance points to around $6.6 billion. CEO Tim Archer credited “AI-driven demand reshaping the semiconductor industry.”
LRCX stock is up 89% year to date. If Terafab eventually adds significant memory supply, DRAM and NAND prices could weaken, yet Lam Research still collects equipment revenue.
3. Camtek (CAMT) Camtek (NASDAQ:CAMT) is an Israel-based inspection and metrology specialist concentrated in advanced packaging, the third pillar of Terafab’s vertical-integration strategy. CEO Rafi Amit described “an unprecedented start to the year in terms of incoming orders” and called the company “positioned at the epicenter of the AI market.”
Camtek’s Q1 FY2026 revenue came in at $121.66 million with non-GAAP EPS of $0.70, and management guided second-half 2026 to grow over 25% versus the first half. Camtek stock trades at a forward P/E ratio of 47x with a consensus analyst price target of $187.25.
Risks include Middle East geopolitics and Strait of Hormuz supply-chain exposure. CAMT shares are off 18.5% over the past month, a reminder that small-cap equipment names trade with sharp swings.
4. Onto Innovation (ONTO) Onto Innovation (NYSE:ONTO) provides process control, metrology and inspection tools for advanced packaging, HBM and gate-all-around logic, mirroring Terafab’s roadmap. Onto recently signed a $240 million-plus volume purchase agreement with a leading HBM manufacturer through 2027.
Onto Innovation’s Q1 FY2026 revenue reached $291.95 million, and management guided Q2 to $320 million to $330 million. CEO Mike Plisinski pointed to “global AI investment fueling a robust upcycle in semiconductor capital equipment spending.”
ONTO stock carries a trailing P/E ratio of 118x and an analyst target of $351.88. The valuation already prices in robust AI capex, so any delay in Terafab or HBM cooling could compress the multiple.
5. Cohu (COHU) Cohu (NASDAQ:COHU) rounds out the list as the early-cycle test and handling play. About 60% of Cohu’s revenue is recurring, and Cohu’s test-cell utilization rose to 78% at the end of March.
The company’s Q1 FY2026 revenue grew 29% to $125.12 million, though non-GAAP EPS of $0.01 missed the $0.03 estimate. Cohu’s management raised its FY2026 high-performance computing revenue outlook to $80 million to $100 million, against an AI-driven compute addressable market sized at around $750 million.
COHU stock has surged 132% year to date, reflecting cyclical recovery hopes. The bear case: Cohu’s ongoing GAAP losses, customer concentration, and tariff exposure leave little margin for execution slips.
What to Watch Now If SpaceX’s IPO succeeds and Musk uses public equity to advance Terafab, every front-end and back-end equipment vendor with logic, memory and packaging exposure stands to win incremental orders. The five names listed above sit closest to the action across lithography, etch and deposition, packaging inspection, metrology and test.
However, the thesis hinges on two unknowns: whether Terafab is built at the scale described in the S-1, and whether AI capex from buyers like Taiwan Semiconductor Manufacturing (NYSE:TSM), Samsung, and Micron Technology (NASDAQ:MU) stays elevated through 2027 and beyond. Export controls, tariffs, and the China overhang for ASML and Lam Research add uncertainty.
For investors in memory makers, equipment names can offer exposure to the AI buildout while hedging memory-price risk. Watch the SpaceX debut and any disclosure on Terafab capital expenditures and equipment partners.
Prada S.p.A. (OTCMKTS:PRDSF – Get Free Report) shares crossed below its 200-day moving average during trading on Thursday . The stock has a 200-day moving average of $5.53 and traded as low as $4.8120. Prada shares last traded at $4.8120, with a volume of 24,304 shares.
Prada Stock Performance The business’s 50 day moving average is $5.08 and its two-hundred day moving average is $5.53.
About Prada (Get Free Report)
Prada S.p.A. is an Italian luxury fashion house known for its high‐end leather goods, ready‐to‐wear clothing, footwear, eyewear, fragrances and accessories. Founded in 1913 by Mario Prada in Milan, the company has grown into one of the world’s most recognizable luxury brands, combining artisanal craftsmanship with contemporary design. Prada’s collections are positioned at the premium end of the market, appealing to a global customer base seeking both timeless elegance and avant‐garde style.
Under the creative direction of Miuccia Prada—who joined the family business in the late 1970s—and the strategic leadership of Patrizio Bertelli, Prada has expanded its product lines and retail footprint.
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Item 1 of 3 Meryl Streep, Anne Hathaway, Stanley Tucci and Emily Blunt attend the "The Devil Wears Prada 2" European premiere in London, Britain, April 22, 2026. REUTERS/Jack Taylor TPX IMAGES OF THE DAY
[1/3]Meryl Streep, Anne Hathaway, Stanley Tucci and Emily Blunt attend the "The Devil Wears Prada 2" European premiere in London, Britain, April 22, 2026. REUTERS/Jack Taylor TPX IMAGES OF THE DAY Purchase Licensing Rights, opens new tab
LONDON, April 22 (Reuters) - The Devil Wears Prada 2" brings back the flash and fashion of the original film but also offers insight into a transformed media landscape, its stars and makers said at the movie's European premiere in London on Wednesday.
The sequel comes two decades after "The Devil Wears Prada", with filmmaker David Frankel returning to direct from a screenplay by Aline Brosh McKenna.
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It sees Andy Sachs, played by Anne Hathaway, getting laid off from her investigative journalism job and reuniting with her boss from 20 years ago, the feared fashion magazine editor Miranda Priestly, portrayed by Meryl Streep.
Priestly's "Runway" is also grappling with challenges presented by the digital age and the decline of print media.
"It sort of underwrites all the flash and fun and music and the uncertainty of this current moment," said Streep on the red carpet. "The media landscape, but in every form of business, life, music, art, movies, pick a thing, we're all being undermined. That's where the movie kind of starts and it goes from there to see what these characters do with that new landscape."
Unlike the first film, which was based on Lauren Weisberger's novel of the same name, the sequel features an original storyline.
"Everybody's facing challenges, economic challenges. And so it felt like thematically it'd be something that would interest people," said McKenna. The writing came with huge pressure, McKenna said, but she sought to have fun while finding the characters "the way you would an old friend".
Reuniting with much of the original team was "magic", said Hathaway, who had few conditions for reprising her role.
"I just said that I thought Andy hadn't started the family portion of her life, if that ever happened for her. That was my one condition," she said, adding she was open to everything else - unlike Streep, who joked her many stipulations included "no heels over four inches".
Stanley Tucci also returns as Priestly's devoted right-hand man Nigel, while her overworked assistant Emily (Emily Blunt) has moved up to a powerful position in the fashion industry.
Lucy Liu, Kenneth Branagh and Simone Ashley are among new cast members. Celebrity cameos in the sequel, which was shot in New York and Milan, include pop star Lady Gaga and fashion designer Donatella Versace.
"The Devil Wears Prada 2" begins its global theatrical rollout on April 29.
Reporting by Hanna Rantala; Editing by David Gregorio
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HomeIndustriesThe original 2006 movie chronicled the world of fashion magazines at their peak, but since then ad pages and Vogue’s legendary September issue have been cut in halfPublished: April 28, 2026 at 1:45 p.m. ET
Meryl Streep is reprising her role as Miranda Priestly in “The Devil Wears Prada 2,” which is set for wide release in theaters on Friday. Photo: Walt Disney Studios Motion Pictures/Courtesy Everett CollectionWhen “The Devil Wears Prada” first opened in theaters in 2006, magazines like Vogue were fat with ads, famed for their lavish staff expense reports and considered bibles of the fashion world.
The long-awaited sequel is due out from Walt Disney Studios DIS on Friday, but over the past 20 years, the world of fashion magazines has become a far different place.
The fashion house's sales rose 10% on year at constant currency. Excluding the contribution from Versace, retail sales were up 1% compared with the same period a year earlier.
'Devil Wears Prada 2' Producer Wendy Finerman joins 'Fast Money' to talk the kick off to the summer movie season, the state of the entertainment business, and much more.
Disney has proven that you don't need superheroes, explosive action-packed sequences or blue-skinned aliens for a sequel to perform well at the box office.
Over the weekend, the studio released "The Devil Wears Prada 2" under its 20th Century Studios banner to raucous results. The sequel film to 2006's "The Devil Wears Prada" tallied around $77 million domestically during its opening weekend, the third-highest debut of the year. That's nearly triple the $27.5 million that the first film generated during its opening weekend two decades ago, according to data from Comscore.
Internationally, "The Devil Wears Prada 2" secured more than $150 million, bringing its total haul to around $233 million globally for its first three days in theaters. That total is 72% of what the original "The Devil Wears Prada" generated during its entire theatrical run.
"Some things never go out of fashion," Paul Dergarabedian, head of marketplace trends at Comscore told CNBC. "It's difficult to predict whether audiences will embrace or reject a sequel to a beloved original, but the creative teams, the marketing folks and the distribution team of Disney's 20th Century Studios put together an irresistible hit movie that had not just appeal in the United States but also around the world."
watch now
Disney's return to the well for a "The Devil Wears Prada" sequel comes at a time where Hollywood has become more reliant on tried-and-true intellectual property. In fact, the 2026 calendar is filled with titles connected to major franchises like Star Wars, Marvel, DC Comics, Toy Story, Super Mario Bros., Hunger Games, Scream, Scary Movie, Minions, Dune and Jumanji.
There's even a sequel to 1998's "Practical Magic" coming in the fall.
While "The Devil Wears Prada 2" isn't the typical blockbuster movie sequel that usually kicks off the summer movie season, it showcases the fervor of audiences for nostalgic IP.
"Usually the movies that kick off this kind of weekend are what I like to refer to as 'cape' movies," Wendy Finerman, an Academy Award-winner and producer of "The Devil Wears Prada 2," said on CNBC's "Fast Money" Monday.
The characters in this film wear a different kind of cape, she noted, adding it's a story "where you take off the cape and you're more powerful."
The film drove significant attendance from female moviegoers, who represented 76% of tickets sold. It also brought out an older cohort of moviegoers. While the majority of tickets, about 28%, were sold to those age 25 to 34 years old, the second-highest demographic was moviegoers over 55, which accounted for 22% of tickets sold.
"There was a group of people from Boston, friends of mine, 30 women went together," Finerman said. "... Families are going, sisters are going. And the other thing is, and it's not just here, all over the world, people are dressing up. It's become an event. They're wearing red shoes, they're wearing makeup, they're looking like different characters, they're saying certain lines."
"So it's become an event versus just going to the movies," she said.
Correction: This story has been revised to reflect that Disney released "The Devil Wears Prada 2" under its 20th Century Studios banner. A previous version misstated the name of the studio.
In the latest close session, Signet (SIG - Free Report) was up +2.99% at $84.05. The stock exceeded the S&P 500, which registered a gain of 0.61% for the day. Elsewhere, the Dow saw a downswing of 0.23%, while the tech-heavy Nasdaq appreciated by 1.19%.
Heading into today, shares of the jewelry company had lost 7.02% over the past month, lagging the Retail-Wholesale sector's loss of 2.5% and the S&P 500's gain of 4.44%.
Market participants will be closely following the financial results of Signet in its upcoming release. The company plans to announce its earnings on June 2, 2026. The company's upcoming EPS is projected at $1.32, signifying a 11.86% increase compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $1.56 billion, reflecting a 1.06% rise from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $10.3 per share and a revenue of $6.85 billion, indicating changes of +7.29% and +0.46%, respectively, from the former year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Signet. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Right now, Signet possesses a Zacks Rank of #3 (Hold).
From a valuation perspective, Signet is currently exchanging hands at a Forward P/E ratio of 7.93. This signifies a discount in comparison to the average Forward P/E of 21.48 for its industry.
It's also important to note that SIG currently trades at a PEG ratio of 0.94. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Jewelry stocks are, on average, holding a PEG ratio of 2.25 based on yesterday's closing prices.
The Retail - Jewelry industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 51, putting it in the top 21% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
Signet Jewelers remains a 'buy' despite recent underperformance, supported by stable financials, a strong balance sheet, and compelling valuation. SIG's strategic focus includes portfolio consolidation, digital investments, and expanding higher-margin service revenue to drive long-term value. Management expects Q1 2027 revenue of $1.53–$1.57B and EBITDA of $112–$123M, driven by stronger Valentine's Day demand and higher gold prices.
HAMILTON, Bermuda--(BUSINESS WIRE)--Signet Jewelers Limited ("Signet" or the "Company") (NYSE:SIG) today announced its results for the 13 weeks ended May 2, 2026 ("first quarter Fiscal 2027"). "We drove topline growth in the first quarter with all categories up on a comparable sales basis. We also delivered positive performances for both Valentine's Day in February as well as Mother's Day to start the second quarter," said J.K. Symancyk, Chief Executive Officer. "These early proof points of our.
Signet Jewelers Limited (NYSE:SIG) shares rose nearly 5% after the company reported first quarter financial results that beat earnings expectations and showed steady comparable sales growth, alongside an improved full-year outlook.
The company reported adjusted diluted earnings per share of $1.56, above analyst estimates of $1.32 to $1.38 and up roughly 32% year-over-year.
Revenue came in at approximately $1.55 billion, broadly in line with consensus expectations of $1.56 billion.
Comparable store sales increased 1.8% compared with the prior-year period, driven by an approximately 5% rise in merchandise average unit retail, with gains across both bridal and fashion categories.
The company also updated its fiscal 2027 outlook, narrowing its sales range to $6.7 billion to $6.9 billion, compared with a prior range of $6.6 billion to $6.9 billion. It maintained its same-store sales forecast of a decline of 0.75% to growth of 2.5%.
Adjusted EPS guidance was raised to $9.20 to $11.00 from $8.80 to $10.74, while adjusted EBITDA is now expected between $665 million and $745 million.
Signet said it continues to expect improved profitability and steady execution through the remainder of the fiscal year, supported by cost discipline and demand trends in key gifting and bridal categories.
"We drove topline growth in the first quarter with all categories up on a comparable sales basis,” Signet CEO J.K. Symancyk said in a statement.
“We also delivered positive performances for both Valentine’s Day in February as well as Mother’s Day to start the second quarter. These early proof points of our Grow Brand Love strategy show we can perform and transform at the same time.”
Jefferies wrote that Signet’s Q1 results strengthened its positive view on the stock, pointing to broad-based same-store sales growth and improving mix, with average unit retail rising about 5% across bridal and fashion categories.
The firm highlighted profitability as the key driver in the quarter, noting that adjusted EBITDA outperformance reflected SG&A leverage following last year’s restructuring efforts.
It also pointed to the company’s decision to raise full-year EPS guidance, attributing the update to solid execution in the quarter and stronger-than-expected demand around Mother’s Day.
Jefferies added that free cash flow generation continues to underpin the investment case, with capital returns supported by ongoing buybacks and a newly announced accelerated share repurchase program.
The firm said these factors reinforce its bullish outlook, maintaining that upside potential remains significant if current trends persist.
Signet (SIG - Free Report) came out with quarterly earnings of $1.56 per share, beating the Zacks Consensus Estimate of $1.32 per share. This compares to earnings of $1.18 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of +18.18%. A quarter ago, it was expected that this jewelry company would post earnings of $5.96 per share when it actually produced earnings of $6.25, delivering a surprise of +4.87%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Signet, which belongs to the Zacks Retail - Jewelry industry, posted revenues of $1.55 billion for the quarter ended April 2026, missing the Zacks Consensus Estimate by 0.28%. This compares to year-ago revenues of $1.54 billion. The company has topped consensus revenue estimates two times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Signet shares have added about 2.3% since the beginning of the year versus the S&P 500's gain of 11%.
What's Next for Signet?While Signet has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Signet was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.70 on $1.54 billion in revenues for the coming quarter and $10.30 on $6.85 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Jewelry is currently in the top 10% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Another stock from the broader Zacks Retail-Wholesale sector, Macy's (M - Free Report) , has yet to report results for the quarter ended April 2026. The results are expected to be released on June 3.
This department store operator is expected to post quarterly earnings of $0.02 per share in its upcoming report, which represents a year-over-year change of -87.5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.
Macy's' revenues are expected to be $4.62 billion, up 0.5% from the year-ago quarter.
Signet Jewelers Limited delivered solid Q1 results, with EPS up 32% and same-store sales rising 1.8%, supported by effective pricing and resilient consumer demand. SIG maintains a pristine balance sheet—$600M cash, no debt—and continues aggressive buybacks, with an additional $50M accelerated repurchase announced for June. Guidance was raised, with the EPS outlook lifted to $10.10; shares remain attractively valued at ~9x earnings, despite strong capital returns and stable sales.
3 Quiet Outperformers Boosting Dividends as Markets RetreatSignet Jewelers NYSE: SIG said it delivered a stronger-than-expected start to fiscal 2027, with comparable sales growth across every category and adjusted earnings growth that prompted the jeweler to raise the midpoint of its full-year guidance.
Chief Executive Officer J.K. Symancyk told investors on the company’s first-quarter earnings call that Signet posted “another quarter of comp sales growth” while also advancing its multiyear “Grow Brand Love” strategy. He said the company recorded positive comparable sales in each month of the quarter, though trends softened somewhat in the second half before rebounding around Mother’s Day and into the second quarter.
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Signet Jewelers Stock Poised for Rebound After Earnings Drop“We’ve now delivered positive comp sales in 15 of the last 17 months, and have seen recently our strongest two-year stacks since pandemic stimulus spending,” Symancyk said.
First-quarter sales rise as AUR increases Chief Operating and Financial Officer Joan Hilson said first-quarter revenue was $1.6 billion, with comparable sales up 1.8%. James Allen represented a one-point drag on comparable sales in the quarter, she said.
The Retail Sector is on the cusp of a major breakoutBy category, bridal and fashion grew in the low single digits, while watches and services posted stronger growth. Average unit retail, or AUR, rose nearly 5% and increased across all categories, including high-single-digit growth in bridal.
Symancyk said Signet saw strength at higher price points, with collections including Shy supporting fashion growth and Neil Lane and Monique Lhuillier helping drive bridal. He also said unit trends improved sequentially by three points compared with the fourth quarter, though lower price points remain more challenged due in part to gold costs.
“If you look at price points above $2,000 in our business, they’re call it mid-ish single digits in terms of unit penetration, but 40-ish% as it relates to revenue,” Symancyk said during the Q&A portion of the call.
Margins pressured by gold, offset by cost discipline Adjusted gross margin was $589 million, with the rate down approximately one percentage point. Hilson said the decline reflected 70 basis points of merchandise margin pressure, primarily from higher gold costs, partially offset by 20 basis points of occupancy leverage.
SG&A expenses fell 3% from a year earlier, reflecting restructuring under the Grow Brand Love operating model and ongoing spending discipline. Adjusted operating income rose 12%, and adjusted diluted earnings per share increased more than 30% to $1.56, helped by earnings growth, higher interest income and a lower diluted share count.
Hilson said Signet repurchased approximately 1.3 million shares for $114 million as of the morning of the call. Once an accelerated share repurchase is completed, the company expects to have about $355 million remaining under its share repurchase authorization.
Inventory ended the quarter at $2 billion, roughly flat year over year, while cash increased nearly $340 million to more than $600 million. Free cash flow improved by $43 million from last year, despite the payout of annual incentive compensation that did not occur in the prior year.
Blue Nile repositioning and James Allen transition continue Hilson said Signet is repositioning Blue Nile as a premium brand focused on a more affluent customer and anchored in natural diamonds. She said the company believes about 70% of engagement market revenue remains in natural diamonds, and that natural diamonds account for more than 90% of engagement revenue above $5,000.
To accelerate that strategy, Signet recently acquired The Clear Cut, a digitally native natural diamond jewelry brand. Hilson described the transaction as a small tuck-in acquisition that brings diamond expertise, a proprietary curation process, concierge service and a significant social media following to Blue Nile.
The company also completed the commercial transition of James Allen, sunsetting its website in mid-May and redirecting traffic to Blue Nile. Hilson said the company is now using James Allen as a proprietary collection while discontinuing remaining assortment not relevant to other brands. Signet recorded a $32 million non-cash inventory write-down related to the exit of that inventory, and total restructuring and related charges were $42 million, most of which were non-cash.
Hilson said the company does not expect material charges related to the James Allen transition going forward.
Company raises full-year outlook Signet raised the midpoint of its full-year outlook, citing first-quarter performance and second-quarter momentum. For fiscal 2027, the company now expects:
Same-store sales ranging from down 0.75% to up 2.5%. Total revenue between $6.7 billion and $6.9 billion. Adjusted operating income between $480 million and $560 million. Adjusted earnings per share between $9.20 and $11.00. Capital expenditures of $150 million to $180 million. The company expects AUR growth across categories with modest unit declines, especially at lower price points, largely due to higher gold costs. Hilson said that beginning in the second quarter, Blue Nile and James Allen will be excluded from same-store sales for the next year to reflect the transition of those brands, which should benefit same-store sales by 50 to 70 basis points going forward.
For the second quarter, Signet expects same-store sales to rise 0.5% to 2.5%, with adjusted operating income between $79 million and $93 million. Hilson said merchandise margin is expected to be lower in the quarter because of higher gold costs, but the company expects SG&A and occupancy leverage to generally offset that pressure at the midpoint of guidance.
Strategy focuses on brand distinction and operating efficiency Symancyk said Signet is in the second year of its Grow Brand Love strategy, which focuses on brand distinction, unlocking portfolio value and strengthening the operating model.
The company is redesigning websites for Kay, Zales and Jared, with the work furthest along at Jared and expected to be completed for all three in the early part of the third quarter. Symancyk said the websites are Signet’s largest storefronts and that improving search, navigation and storytelling is important ahead of the holiday season.
Signet is also shifting marketing toward social-first storytelling and creator partnerships. Symancyk cited Zales’ partnership with Ashley Graham and Kay’s collaboration with Christian McCaffrey, saying the latter delivered more than twice the company’s average social engagement rate.
On tariffs, Symancyk said Signet continues to monitor developments and has submitted refund claims for most purchases where it is the importer of record. He said a small amount has been approved and received, but it is too early to quantify potential refunds or their timing.
“We believe Grow Brand Love is setting the foundation for sustainable long-term growth, with the ability to grow even during turbulent macro periods,” Symancyk said.
About Signet Jewelers NYSE: SIGSignet Jewelers Ltd is the world's largest retailer of diamond jewelry, operating a diversified network of retail stores across the United States, Canada, the United Kingdom and Ireland. Its portfolio includes well-established banners such as Kay Jewelers, Zales, Jared The Galleria of Jewelry, H.Samuel, Ernest Jones, Peoples and Piercing Pagoda, offering customers a range of shopping environments from suburban malls to high-street locations.
The company's product assortment encompasses engagement rings, wedding bands, fine fashion jewelry and timepieces, complemented by services including jewelry cleaning, repairs, appraisals and extended care plans.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Key Takeaways Signet Jewelers Q1 adjusted EPS beat estimates, supported by higher operating income.Signet Jewelers saw same-store sales rise 1.8% y/y, led by growth in Bridal and Fashion categories.Signet Jewelers increased its FY27 sales and adjusted EPS guidance after a strong quarter. Signet Jewelers Limited (SIG - Free Report) has posted first-quarter fiscal 2027 results, wherein the bottom line beat the Zacks Consensus Estimate, while the top line marginally missed. Sales increased year over year, supported by positive same-store sales growth and strength across the Bridal and Fashion categories.
The company benefited from healthy consumer demand during the Valentine’s Day and early Mother’s Day selling periods, as well as continued progress under its “Grow Brand Love” strategy. Management accelerated go-to-market initiatives across Kay, Zales and Jared, focusing on stronger brand differentiation, more impactful marketing campaigns, enhanced digital experiences and improved store environments. These efforts are aimed at strengthening customer engagement and supporting sustainable long-term growth.
Cost-reduction initiatives implemented in fiscal 2026 contributed to margin expansion and higher adjusted operating income. Encouraged by strong fiscal first-quarter execution and positive trends entering the second quarter, management raised its fiscal 2027 adjusted EPS outlook and increased the midpoint of its sales and profitability guidance.
More on Signet’s Q1 ResultsSIG reported adjusted earnings of $1.56 per share in the first quarter of fiscal 2027, surpassing the Zacks Consensus Estimate of $1.32. The bottom line increased 32.2% from adjusted earnings of $1.18 in the year-ago period, benefiting from higher adjusted operating income, a lower diluted share count and higher interest income.
This jewelry retailer generated total sales of $1,553.6 million, slightly missing the consensus estimate of $1,558 million. However, the top line increased 0.8% year over year. Same-store sales grew 1.8%, while merchandise average unit retail rose approximately 5% from the prior-year quarter, driven by growth in the Bridal and Fashion categories.
Insight Into SIG’s Margins & ExpensesGross profit in the first quarter of fiscal 2027 totaled $556.5 million, down 7.1% from $598.8 million in the year-ago quarter. The gross margin contracted 310 basis points year over year to 35.8%, primarily reflecting inventory write-downs related to the transition of the James Allen brand. Adjusted gross profit was $589.2 million, falling 1.6% year over year. The adjusted gross margin was 37.9%, which moved down 90 basis points year over year.
Selling, general and administrative (SG&A) expenses were $509.6 million, down 3.1% from $526 million in the prior-year quarter. As a percentage of sales, SG&A expenses improved 130 basis points year over year to 32.8%, benefiting from cost-reduction initiatives implemented in fiscal 2026 and leverage from higher sales.
SIG reported adjusted operating income of $78.6 million, up 11.8% from $70.3 million in the year-ago quarter. The adjusted operating margin expanded 50 basis points year over year to 5.1%.
Adjusted EBITDA amounted to $120.8 million, increasing 6.2% from $113.8 million in the prior-year quarter. The adjusted EBITDA margin improved approximately 40 basis points year over year to 7.8% in the quarter under review.
Update on Signet’s Segmental PerformanceSales in the North America segment increased 0.9% year over year to $1.46 billion in the first quarter of fiscal 2027, which met the Zacks Consensus Estimate. Same-store sales grew 1.6%. The segment’s adjusted operating income increased to $101.4 million from $97.1 million in the prior-year quarter, with the adjusted operating margin expanding to 6.9% from 6.7%.
Sales in the International segment increased 9.2% year over year to $87.5 million, slightly surpassing the consensus estimate of $85 million. Same-store sales rose 5.6%, while sales increased 4.8% on a constant-currency basis. The segment reported an adjusted operating loss of $6.6 million compared with a loss of $7 million in the year-ago quarter.
Update on SIG's StoresAs of May 2, 2026, Signet operated 2,559 stores across its portfolio, representing a net reduction of 23 stores from the end of fiscal 2026. The North America segment operated 2,308 stores after 21 closures during the quarter, while the International segment operated 251 stores following two closures. Total selling space declined 0.4% sequentially to approximately 4 million square feet.
Signet’s Financial Snapshot: Cash, Debt & Equity OverviewSIG ended the first quarter of fiscal 2027 with cash and cash equivalents of $602.8 million compared with $264.1 million in the year-ago period. Inventory totaled approximately $2 billion, remaining essentially flat year over year. Meanwhile, total liquidity reached $1.7 billion, an increase of more than $300 million from the prior-year period. Shareholders’ equity stood at $1.90 billion at the quarter-end.
During the quarter, net cash used in operating activities was $144.7 million, an improvement from the cash use of $175.3 million in the prior-year period. Capital expenditure totaled $24.5 million during the quarter as the company continued investing in strategic growth initiatives and store-optimization efforts.
Signet remained active in returning capital to shareholders. The company repurchased 0.9 million shares for $83 million during the quarter and additional 0.4 million shares for roughly $30 million after the quarter-end. Management also announced plans to initiate a $50-million accelerated share repurchase program, which would leave approximately $355 million available under the existing authorization upon completion.
The company’s board declared a quarterly cash dividend of 35 cents per share, payable Aug. 21, 2026, to shareholders of record as of July 24, 2026. Signet noted that its strong cash generation, inventory discipline and balance-sheet strength continue to support growth investments and shareholder returns.
SIG’s Q2 GuidanceFor the second quarter of fiscal 2027, Signet expects total sales of $1.50-$1.53 billion. Same-store sales are projected to increase 0.5-2.5% year over year. Adjusted operating income is expected between $79 million and $93 million, while adjusted EBITDA is projected to be $125-$139 million.
What to Expect From Signet in FY27?Following its strong fiscal first-quarter performance, SIG raised portions of its fiscal 2027 outlook. The company expects total sales of $6.7-$6.9 billion compared with the prior mentioned $6.6-$6.9 billion. Same-store sales are projected to range from a decline of 0.75% to growth of 2.5%, an improvement from the previously stated 1.25% decline to 2.5% growth. Management expects a $60-$80 million reduction in revenues related to the transition of the James Allen brand, though with minimal impact on adjusted operating income.
The company anticipates adjusted operating income of $480-$560 million, up from the previously mentioned $470-$560 million. Adjusted EBITDA is projected to be $665-$745 million compared with the prior guidance of $655-$745 million. Signet also raised its adjusted EPS outlook to $9.20-$11.00 from the earlier mentioned $8.80-$10.74.
The fiscal 2027 guidance assumes a dynamic tariff, commodity and consumer environment, planned capital expenditure of $150-$180 million, and a low-single-digit reduction in net square footage. Notably, the adjusted EPS guidance excludes any potential share repurchases beyond the planned $50-million accelerated share repurchase program.
SIG Stock Past 3-Month Performance
Image Source: Zacks Investment Research
This Zacks Rank #3 (Hold) company’s shares have lost 12.7% in the past three months compared with the industry’s 3.1% decline.
Stocks to ConsiderWe have highlighted three better-ranked stocks in the retail space, namely, Tapestry, Inc. (TPR - Free Report) , Ross Stores Inc. (ROST - Free Report) and Levi Strauss & Co. (LEVI - Free Report) .
Tapestry is the designer and marketer of fine accessories and gifts for women and men in the United States and internationally. The company flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Tapestry’s current fiscal-year earnings and sales indicates growth of 36.3% and 13.8%, respectively, from the year-ago actuals. TPR delivered a trailing four-quarter average earnings surprise of 15.6%.
Ross Stores operates as an off-price retailer of apparel and home accessories, primarily in the United States. The company sports a Zacks Rank #1 at present.
The Zacks Consensus Estimate for Ross Stores’ current fiscal-year earnings and sales indicates growth of 15.6% and 8.2%, respectively, from the year-ago actuals. ROST delivered a trailing four-quarter average earnings surprise of 10.2%.
Levi Strauss designs and markets jeans, casual wear and related accessories for men, women and children. It currently carries a Zacks Rank of 2 (Buy).
The Zacks Consensus Estimate for Levi Strauss’ current fiscal-year earnings and sales suggests growth of 11.9% and 5.2%, respectively, from the year-ago actuals. LEVI delivered a trailing four-quarter average earnings surprise of 21.4%.
Signet Jewelers Limited (NYSE:SIG) shares rose nearly 5% after the company reported first quarter financial results that beat earnings expectations and showed steady comparable sales growth, alongside an improved full-year outlook.
The company reported adjusted diluted earnings per share of $1.56, above analyst estimates of $1.32 to $1.38 and up roughly 32% year-over-year.
Revenue came in at approximately $1.55 billion, broadly in line with consensus expectations of $1.56 billion.
Comparable store sales increased 1.8% compared with the prior-year period, driven by an approximately 5% rise in merchandise average unit retail, with gains across both bridal and fashion categories.
The company also updated its fiscal 2027 outlook, narrowing its sales range to $6.7 billion to $6.9 billion, compared with a prior range of $6.6 billion to $6.9 billion. It maintained its same-store sales forecast of a decline of 0.75% to growth of 2.5%.
Adjusted EPS guidance was raised to $9.20 to $11.00 from $8.80 to $10.74, while adjusted EBITDA is now expected between $665 million and $745 million.
Signet said it continues to expect improved profitability and steady execution through the remainder of the fiscal year, supported by cost discipline and demand trends in key gifting and bridal categories.
"We drove topline growth in the first quarter with all categories up on a comparable sales basis,” Signet CEO J.K. Symancyk said in a statement.
“We also delivered positive performances for both Valentine’s Day in February as well as Mother’s Day to start the second quarter. These early proof points of our Grow Brand Love strategy show we can perform and transform at the same time.”
Jefferies wrote that Signet’s Q1 results strengthened its positive view on the stock, pointing to broad-based same-store sales growth and improving mix, with average unit retail rising about 5% across bridal and fashion categories.
The firm highlighted profitability as the key driver in the quarter, noting that adjusted EBITDA outperformance reflected SG&A leverage following last year’s restructuring efforts.
It also pointed to the company’s decision to raise full-year EPS guidance, attributing the update to solid execution in the quarter and stronger-than-expected demand around Mother’s Day.
Jefferies added that free cash flow generation continues to underpin the investment case, with capital returns supported by ongoing buybacks and a newly announced accelerated share repurchase program.
The firm said these factors reinforce its bullish outlook, maintaining that upside potential remains significant if current trends persist.
On Tuesday, Signet Jewelers (SIG +6.79%) stock was looking as shiny and attractive as the wares the company sells. The retail jewelry conglomerate's shares were a hot item that trading session, thanks mainly to an earnings report that beat analyst estimates. Signet's equity closed the day almost 4% higher in price.
Crushing it on the bottom line For Signet's first quarter of fiscal 2027, the company's total sales came in at just over $1.55 billion, a marginal improvement over the same period the previous year. That was on the back of same-store sales that increased by nearly 2%. On a per-share basis, net income not under generally accepted accounting principles (GAAP) saw a steeper rise, gaining 32% to $1.56 per share.
Image source: Getty Images.
The company's revenue was essentially in line with the consensus analyst estimate of $1.56 billion, but it beat convincingly on the $1.38 per share non-GAAP (adjusted) net income forecast.
In its earnings release, Signet attributed its better financials to higher sales across all product categories. It also did particularly well on Valentine's Day, a banner holiday for the jewelry industry, and in the run-up to Mother's Day (which actually fell just outside the quarter's May 2 ending date). The leap in adjusted net income derived mainly from a corporate reorganization completed last year, plus what it termed "leverage from comparable sales growth."
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Guiding for more This is clearly boosting management's confidence, as Signet's leaders raised their full-year profitability guidance. Adjusted net income is now expected to hit $9.20 to $11 per share; previously, that range was $8.80 to $10.74. Similarly, the company's sales guidance was tweaked to $6.7 billion to $6.9 billion, from $6.6 billion to $6.9 billion.
I'm not sure I'd be as confident. Economic insecurity in this country doesn't seem to be abating, not least because inflation remains a threat. I feel Signet, as a luxury retailer, might be particularly vulnerable to a downturn, especially a pronounced one. I'm not bullish on this stock currently.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Signet Jewelers (SIG +6.79%) is the world's largest retailer of diamond jewelry.
The company competes in a mature industry, but the stock offers a chance to get exposure to the jewelry segment from an industry leader trading at a value price.
Over the last five years, Signet has traded sideways as the company dealt with a post-pandemic hangover, high inflation, and a sluggish consumer spending environment. However, after bringing in a new CEO and organizing around its Grow Brand Love transformation strategy, the business is looking as healthy as it has in a long time, with comparable sales up in four out of the last five quarters and a solid guidance hike in its first-quarter report.
Let's take a look at the latest results.
Image source: Getty Images.
Signet shines again During a period with record-low consumer sentiment, Signet managed to deliver solid results with comparable sales up 1.8% in the first quarter, and revenue rose 0.8% to $1.55 billion, which matched expectations. The gap between those numbers is explained by the company's ongoing store rationalization program.
Signet managed to buck the overall headwinds in the consumer discretionary sector as CEO J.K. Symancyk said that because jewelry is an emotional and a considered purchase, it's not necessarily exposed to pressure from high gas prices or inflation like more incidental purchases might be.
Average unit retail was up 5%, and units sold fell 3%, showing the company is finding success at the higher end of the market, while it's experiencing pressure at the lower end due in part to higher gold prices.
Gross margin in the quarter actually fell 70 basis points to 35.8% due in part to inventory write-downs from its transition away from the James Allen banner, which is being folded into Blue Nile. The company also took advantage of elevated gold prices to melt down and trade in some of its gold inventory.
Adjusted operating margin expanded from 4.6% to 5.1% as the company benefited from increased leverage due to the gains in comparable sales and from $18 million in cost savings from the Grow Brand Love strategy.
On the bottom line, adjusted earnings per share jumped from $1.18 to $1.56, easily beating the consensus at $1.38. In addition to higher adjusted operating income, the company benefited from a lower tax rate and ongoing share repurchases as it reduced shares outstanding by more than 5% over the last year.
Signet also raised its full-year guidance. The company is now calling for comparable sales of -0.75% to 2.5%, up from a previous range of -1.25% to 2.5%, and now it expects adjusted earnings per share of $9.20-$11.00, up from a previous range of $8.80-$10.74.
Based on the updated forecast, Signet trades at a forward P/E of just 9.
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Signet also announced an accelerated $50 million share repurchase program, which it intends to begin this month, and the company has $355 million remaining in its share repurchase authorization after that, or about 10% of its market cap.
With comps now positive, investors seem to be underestimating the upside potential of Signet as it can deliver solid EPS growth with the combination of rising comps, an improving margin, and a lower share count.
For value-minded investors, Signet looks like an attractive choice right now. If the company can continue delivering comparable sales growth, earnings per share should move higher as well, fueling gains in the stock.
On June 03, 2026, Signet Jewelers Ltd SIG shares fell 3.0% to $85.35, reflecting a broader market sentiment. The stock has fluctuated within a 52-week range of $71.62 to $110.20. The recent decline comes after a slight uptick of 2.6% over the past week, but the stock remains up 15.2% over the past year.
GF Value™ verdict: Current price of $85.35 is 10.0% below the GF Value™ estimate of $94.81.GF Score™ is 83/100, indicating a strong overall ranking.Notable signal: Financial Strength rating of 7/10 suggests a solid foundation. Is SIG Overvalued or Undervalued? Currently, Signet Jewelers Ltd SIG is trading at $85.35, which is 10.0% below its GF Value™ of $94.81. This undervaluation presents a potential opportunity for investors, indicating that the stock may be worth considering for those looking to invest in a solid retail player. The GF Valuation label categorizes SIG as "Modestly Undervalued," which suggests that there exists a margin of safety for potential investors. GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates.
Despite the current undervaluation, investors should be aware of the risks associated with investing in retail, particularly in a cyclical industry. The recent decline in stock price could signal volatility ahead, and potential investors should consider the broader market context.
How Does SIG's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 12.0x 9.4x Forward P/E 8.2x N/A Currently, SIG's P/E (TTM) of 12.0x is 27% above its 5-year median P/E of 9.4x, suggesting that the stock is trading above its historical valuation. This analysis partially contradicts the GF Value™ verdict, which indicates that while the stock may be undervalued based on intrinsic value, it is trading at a premium relative to its past performance metrics. This discrepancy warrants careful consideration, particularly for those focused on valuation multiples.
What Does SIG's GF Score™ Tell Us? The GF Score™ ranks stocks based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Higher GF Score™ values have been associated with better long-term returns.
Metric Rating GF Score™ 83 Financial Strength 7/10 Profitability 7/10 Growth 6/10 Valuation 10/10 Momentum 8/10 The GF Score™ of 83/100 reflects a strong overall position for SIG, particularly in the Valuation category, where it scored a perfect 10/10. This indicates that the stock is favorably positioned based on valuation metrics. However, the Growth score of 6/10 highlights a potential area of concern, suggesting that while the company is stable, its growth prospects may not be as robust as some competitors. The Financial Strength and Profitability scores of 7/10 indicate a solid foundation, but the company might need to enhance its growth strategies to fully capitalize on its strong valuation.
What Are Insiders Doing with SIG Stock? In the last three months, there have been no insider transactions reported for Signet Jewelers Ltd. The absence of insider activity may suggest a lack of confidence among executives or simply a period of stability where insiders do not feel the need to buy or sell shares. This could indicate that insiders are content with the company's current direction, but it does not provide additional insight into potential future movements in the stock price.
What This Means for Investors Based on the GF Value™ assessment, Signet Jewelers Ltd SIG is currently undervalued, presenting an opportunity for potential investors. However, the stock's current P/E reflects a premium over its historical averages, which may indicate caution. Therefore, while there is an attractive intrinsic value, one should remain mindful of the broader market conditions and the stock's valuation history.
For the complete analysis, visit the Signet Jewelers Ltd SIG stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is SIG's GF Score™?
SIG's GF Score™ is 83/100, indicating a strong overall ranking based on several key performance factors, suggesting the stock has potential for long-term returns.
Is SIG overvalued or undervalued?
According to GF Value™, SIG is currently undervalued by 10.0%, indicating a potential opportunity for investors looking for value in the retail sector.
What is SIG's P/E ratio?
SIG's P/E (TTM) is 12.0x, which is 27% above its 5-year median P/E of 9.4x, suggesting that the stock is trading at a premium compared to its historical valuation.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
For those looking to find strong Retail-Wholesale stocks, it is prudent to search for companies in the group that are outperforming their peers. Is Signet (SIG - Free Report) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Retail-Wholesale sector should help us answer this question.
Signet is a member of our Retail-Wholesale group, which includes 189 different companies and currently sits at #14 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group.
The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Signet is currently sporting a Zacks Rank of #2 (Buy).
Over the past 90 days, the Zacks Consensus Estimate for SIG's full-year earnings has moved 1.3% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.
According to our latest data, SIG has moved about 3% on a year-to-date basis. At the same time, Retail-Wholesale stocks have gained an average of 0.7%. As we can see, Signet is performing better than its sector in the calendar year.
Another Retail-Wholesale stock, which has outperformed the sector so far this year, is Dillard's (DDS - Free Report) . The stock has returned 0.8% year-to-date.
In Dillard's' case, the consensus EPS estimate for the current year increased 10.4% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy).
To break things down more, Signet belongs to the Retail - Jewelry industry, a group that includes 5 individual companies and currently sits at #24 in the Zacks Industry Rank. On average, this group has gained an average of 8.6% so far this year, meaning that SIG is slightly underperforming its industry in terms of year-to-date returns.
In contrast, Dillard's falls under the Retail - Regional Department Stores industry. Currently, this industry has 4 stocks and is ranked #69. Since the beginning of the year, the industry has moved -2.9%.
Investors interested in the Retail-Wholesale sector may want to keep a close eye on Signet and Dillard's as they attempt to continue their solid performance.
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Signet Jewelers (SIG - Free Report) . SIG is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.
Investors will also notice that SIG has a PEG ratio of 1.04. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SIG's industry has an average PEG of 1.15 right now. Over the past 52 weeks, SIG's PEG has been as high as 3.86 and as low as 0.39, with a median of 0.94.
We should also highlight that SIG has a P/B ratio of 2.27. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 3.39. Over the past year, SIG's P/B has been as high as 2.52 and as low as 1.04, with a median of 1.87.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. SIG has a P/S ratio of 0.5. This compares to its industry's average P/S of 0.84.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Signet Jewelers is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SIG feels like a great value stock at the moment.
Key Takeaways SIG posted 1.8% same-store sales growth as every category and most brands turned positive.Signet raised fiscal 2027 outlook: sales $6.7-$6.9B and adjusted EPS $11.00.Signet repositioned Blue Nile with The Clear Cut buy; James Allen moved in, with a $32M inventory write-down. Signet Jewelers Limited’s (SIG - Free Report) first-quarter fiscal 2027 call centered less on the quarter’s headline beat and more on management’s case that its Grow Brand Love strategy is beginning to show up in both sales and earnings. Executives pointed to broad-based comparable-sales growth, better unit trends and a higher full-year outlook.
The setup matters for investors because Signet is trying to prove it can improve brand positioning, margins and capital returns at the same time. The quarter gave management room to sound more confident on each of those fronts.
Signet Leans on Broad-Based Comp GrowthChief executive officer J.K. Symancyk said Signet posted positive comparable sales in each month of the quarter, with growth across every category and most brands. He emphasized a better balance between average unit retail growth and units, with unit comps improving sequentially from the fourth quarter.
That narrative was supported by the reported numbers. Same-store sales rose 1.8%, revenues increased to $1.55 billion from $1.54 billion a year earlier, and adjusted earnings per share climbed to $1.56 from $1.18.
Adjusted EPS exceeded the Zacks Consensus Estimate by 18.18%, while revenues fell slightly short of the $1.56 billion forecast by 0.28%. The results support management’s view that execution improved despite modest top-line growth.
Signet Pushes Brand and Digital ChangesSymancyk framed the current year as the second year of Grow Brand Love, with the biggest priorities tied to sharper brand distinction, portfolio optimization and a stronger operating model. He said website redesigns for Kay, Zales and Jared are in testing and should be completed early in the fiscal third quarter, ahead of the holiday season.
He also described a more data-driven marketing approach, including social-first storytelling and creator partnerships. Management said Kay generated low double-digit growth in impressions on only a 1% increase in social-media spending, reinforcing the message that the company is changing where it spends rather than simply spending more.
The strategic thread here is differentiation. Management tied clearer digital presentation, tighter assortment and more targeted marketing to improved conversion and stronger brand equity rather than to a short-term promotional lift.
Signet Reworks the Portfolio Around DiamondsChief operating and financial officer Joan Hilson used the call to outline a more defined role for Blue Nile inside the portfolio. She said Blue Nile is being repositioned as a premium natural-diamond brand for a broader but more affluent customer base.
That plan now includes the acquisition of The Clear Cut, a digitally native natural-diamond jeweler with concierge capabilities and proprietary gem technology. Hilson said the deal should strengthen Blue Nile’s luxury positioning and improve how Signet curates stones and serves higher-end customers.
At the same time, James Allen has been folded into Blue Nile. Management disclosed a $32 million noncash inventory write-down tied to the transition and said no material future James Allen charges are expected.
Signet Defends Margins Against Gold PressureHilson said adjusted gross margin was $589.2 million, or 37.9% of sales, with the rate down about 1 percentage point. The main pressure came from higher gold costs, which reduced merchandise margin by about 70 basis points.
Management’s answer was to stress cost control and sourcing discipline rather than to signal aggressive pricing. Symancyk said the company is protecting lower price-point goods through assortment changes, plated offerings and design work that uses less gold, while centralized diamond sourcing should help margins and inventory turnover over time.
In Q&A, Jefferies asked about longer-term margin levers, and management’s tone stayed constructive. Executives pointed to pricing and promotion discipline, inventory health and sourcing scale as the main drivers of future expansion rather than any single near-term fix.
Signet Raises the Full-Year MidpointHilson said Signet raised the midpoint of its fiscal 2027 outlook to reflect first-quarter performance and second-quarter momentum. The company now expects total sales of $6.7 billion to $6.9 billion, same-store sales from down 0.75% to up 2.5%, and adjusted EPS of $9.20 to $11.00, up from the prior $8.80 to $10.74 range.
Second-quarter guidance also implied a stable demand backdrop, with expected same-store sales growth of 0.5% to 2.5% and adjusted operating income of $79 million to $93 million.
Management added that the outlook still assumes a dynamic tariff and commodity environment. Hilson said the company expects a mid-teens effective tariff rate and believes sourcing flexibility can limit the impact if country-specific tariffs rise further.
Signet Leaves a More Assertive ToneThe most revealing Q&A exchanges came on higher-end demand, unit trends and comp quality. Analysts from Stephens, Jefferies and Goldman Sachs pressed management on whether strength at higher price points reflected market-share gains, how much room remains for AUR expansion and what Blue Nile’s premiumization means for the wider portfolio.
Symancyk’s answers were consistently confident. He argued that Signet is underpenetrated at higher price points, is seeing positive momentum across brands and still has room to improve lower-end unit trends as assortment resets move through the year.
Zacks Signals for Signet SIG carries a Zacks Rank #2 (Buy), along with a Value Score of A, Growth Score of B, Momentum Score of A and VGM Score of A. Under the Zacks framework, Zacks Rank #1 (Strong Buy) and 2 stocks paired with Style Scores of A or B carry stronger near-term performance potential and a VGM Score of A points to favorable combined value, growth and momentum characteristics. You can see the complete list of today’s Zacks #1 Rank stocks here.
That said, the Zacks Rank is driven primarily by earnings estimate revisions and can change after a quarterly report as analysts update their models. The current mix of a Zacks Rank #2 and top-tier Style Scores keeps SIG in a favorable screening position, but the signal remains revision-dependent.
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.7% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Signet (SIG - Free Report) Founded in 1950 and headquartered in Hamilton, Bermuda, Signet Jewelers Limited (SIG - Free Report) is the world’s largest retailer of diamond jewelry. The company operates in the United States, Canada, the United Kingdom and the Republic of Ireland. It is often considered to be the leading retailer of diamond jewelry. We note that Signet had 2,582 stores as of Jan. 31, 2026.
SIG is a #2 (Buy) on the Zacks Rank, with a VGM Score of A.
It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 8.22; value investors should take notice.
For fiscal 2027, two analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.27 to $10.57 per share. SIG boasts an average earnings surprise of +87.5%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, SIG should be on investors' short list.
Signet (SIG - Free Report) closed the last trading session at $84.56, gaining 1.7% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $112.22 indicates a 32.7% upside potential.
The average comprises nine short-term price targets ranging from a low of $90.00 to a high of $150.00, with a standard deviation of $19.55. While the lowest estimate indicates an increase of 6.4% from the current price level, the most optimistic estimate points to a 77.4% upside. More than the range, one should note the standard deviation here, as it helps understand the variability of the estimates. The smaller the standard deviation, the greater the agreement among analysts.
While the consensus price target is highly sought after by investors, the ability and unbiasedness of analysts in setting price targets have long been questionable. And investors making investment decisions solely based on this tool would arguably do themselves a disservice.
But, for SIG, an impressive average price target is not the only indicator of a potential upside. Strong agreement among analysts about the company's ability to report better earnings than they predicted earlier strengthens this view. While a positive trend in earnings estimate revisions doesn't gauge how much a stock could gain, it has proven to be powerful in predicting an upside.
Price, Consensus and EPS Surprise
Here's What You May Not Know About Analysts' Price TargetsAccording to researchers at several universities across the globe, a price target is one of many pieces of information about a stock that misleads investors far more often than it guides. In fact, empirical research shows that price targets set by several analysts, irrespective of the extent of agreement, rarely indicate where the price of a stock could actually be heading.
While Wall Street analysts have deep knowledge of a company's fundamentals and the sensitivity of its business to economic and industry issues, many of them tend to set overly optimistic price targets. Are you wondering why?
They usually do that to drum up interest in shares of companies that their firms either have existing business relationships with or are looking to be associated with. In other words, business incentives of firms covering a stock often result in inflated price targets set by analysts.
However, a tight clustering of price targets, which is represented by a low standard deviation, indicates that analysts have a high degree of agreement about the direction and magnitude of a stock's price movement. While that doesn't necessarily mean the stock will hit the average price target, it could be a good starting point for further research aimed at identifying the potential fundamental driving forces.
That said, while investors should not entirely ignore price targets, making an investment decision solely based on them could lead to disappointing ROI. So, price targets should always be treated with a high degree of skepticism.
Why SIG Could Witness a Solid UpsideThere has been increasing optimism among analysts lately about the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher. And that could be a legitimate reason to expect an upside in the stock. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current year, two estimates have moved higher over the last 30 days compared to no negative revision. As a result, the Zacks Consensus Estimate has increased 2.6%.
Moreover, SIG currently has a Zacks Rank #2 (Buy), which means it is in the top 20% of more than 4,000 stocks that we rank based on four factors related to earnings estimates. Given an impressive externally-audited track record, this is a more conclusive indication of the stock's potential upside in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Therefore, while the consensus price target may not be a reliable indicator of how much SIG could gain, the direction of price movement it implies does appear to be a good guide.
Signet Jewelers (SIG +6.79%) saw its stock rise on an otherwise unexceptional Tuesday for the market. Investors bid up the price of the jewelry retail conglomerate by nearly 3% after it revealed plans for a new, $50 million share repurchase program.
A $50 million move In a regulatory filing published late on Monday, Signet disclosed that it has retained white-shoe investment bank Goldman Sachs to enact a $50 million accelerated share repurchase (ASR) program. Under this initiative, Goldman is to deliver approximately 480,000 of these shares to Signet.
Image source: Getty Images.
The bank might be required to deliver additional shares after the completion of the agreement under certain circumstances, Signet wrote in the document. Under others, the specialty retailer could be obligated to make additional payments to Goldman Sachs.
The company added that the final settlement of the ASR agreement should occur between this Friday, June 12, and July 17.
Once this occurs, Signet will have roughly $355 million remaining in share buyback authorizations under a program initiated in 2017.
Today's Change
(
6.79
%) $
5.83
Current Price
$
91.75
Double benefit The goal of any significant share repurchase initiative is to retire a block of shares. When done well, this has the twin benefits of boosting a company's share price -- due to higher demand for the stock -- and lifting its earnings per share (EPS).
While I'm not particularly a fan of share buybacks, as I feel that precious capital can usually be deployed in more productive ways, this one is well within Signet's means (it had over $600 million in cash at the end of its latest-reported quarter) and the move is obviously resonating with investors. That said, I don't think anyone should transact in Signet purely on its repurchasing activities.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group. The Motley Fool has a disclosure policy.
On May 11, 2026, Semtech Corp SMTC shares rose 12.1% to a price of $136.53. This increase comes amid a strong price performance, as the stock has surged 60.2% over the past month and 289.3% over the past year, with a 52-week range between $34.59 and $127.19.
GF Value™ verdict: Current price of $136.53 is 289.9% overvalued compared to a GF Value™ of $35.02. GF Score™: 76/100, indicating above-average performance. Most notable signal: Insiders sold $3.2M worth of shares in the last 3 months, with no buying activity. Is SMTC Overvalued or Undervalued? According to the GF Value™, Semtech Corp is significantly overvalued, with a current share price of $136.53 compared to a GF Value™ estimate of $35.02. This represents a substantial 289.9% overvaluation, indicating a significant margin of safety for potential investors. The high market price suggests that the stocks may not be a prudent investment at this time, as the risk of a price correction is elevated. GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates.
When evaluating the stock's current valuation against its intrinsic value, the risk of overvaluation is apparent. Investors should be cautious, as the stock's price may not sustain its current levels given the inherent risks associated with such a significant overvaluation.
How Does SMTC's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 61.8x 39.3x (5-Year Median) Semtech Corp's current P/E ratio of 61.8x is significantly above its 5-year median P/E of 39.3x. This indicates that the stock is trading above its historical valuation, which aligns with the GF Value™ assessment of being overvalued. Therefore, the P/E analysis reinforces the notion that Semtech may not be an attractive investment at its current price levels.
What Does SMTC's GF Score™ Tell Us? Metric Rating GF Score™ 76 Financial Strength 7/10 Profitability 7/10 Growth 7/10 Valuation 1/10 Momentum 9/10 The GF Score™ of 76/100 indicates that Semtech Corp is above average in terms of its overall performance. The company shows strong rankings in Financial Strength, Profitability, and Growth, all rated at 7/10. However, the Valuation rank of 1/10 highlights significant concerns regarding the stock's current price relative to its intrinsic value. The high Momentum rank of 9/10 suggests positive short-term price performance, but this could be misleading given the overall valuation situation.
What Are Insiders Doing with SMTC Stock? Recent insider activity in Semtech Corp has shown a pattern of selling, with insiders selling $3.2M worth of shares in the last three months and no buying reported. This trend may suggest a lack of confidence among insiders in the company's current valuation and future performance, which could be a red flag for potential investors.
What This Means for Investors Based on the GF Value™ assessment, Semtech Corp is currently overvalued. The significant disparity between the current market price and the intrinsic value suggests that investors should exercise caution and carefully consider the risks before making investment decisions.
For the complete analysis, visit the Semtech Corp SMTC stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is SMTC's GF Score™?
SMTC's GF Score™ is 76/100, indicating above-average performance in terms of financial health and growth potential.
Is SMTC overvalued or undervalued?
SMTC is considered overvalued based on the GF Value™, which estimates the fair value at $35.02 compared to the current price of $136.53.
What is SMTC's P/E ratio?
SMTC's current P/E ratio is 61.8x, which is significantly higher than its 5-year median P/E of 39.3x, suggesting that the stock is trading at an elevated valuation compared to its historical levels.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Wall Street watches a company's quarterly report closely to understand as much as possible about its recent performance and what to expect going forward. Of course, one figure often stands out among the rest: earnings.
We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.
The ability to identify stocks that are likely to top quarterly earnings expectations can be profitable, but it's no simple task. Here at Zacks, our Earnings ESP filter helps make things easier.
The Zacks Earnings ESP, ExplainedThe Zacks Earnings ESP, or Expected Surprise Prediction, aims to find earnings surprises by focusing on the most recent analyst revisions. The basic premise is that if an analyst reevaluates their earnings estimate ahead of an earnings release, it means they likely have new information that could possibly be more accurate.
The core of the ESP model is comparing the Most Accurate Estimate to the Zacks Consensus Estimate, where the resulting percentage difference between the two equals the Expected Surprise Prediction. The Zacks Rank is also factored into the ESP metric to better help find companies that appear poised to top their next bottom-line consensus estimate, which will hopefully help lift the stock price.
In fact, when we combined a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, stocks produced a positive surprise 70% of the time. Perhaps most importantly, using these parameters has helped produce 28.3% annual returns on average, according to our 10 year backtest.
Most stocks, about 60%, fall into the #3 (Hold) category, and they are expected to perform in-line with the broader market. Stocks with a #2 (Buy) and #1 (Strong Buy) rating, or the top 15% and top 5% of stocks, respectively, should outperform the market, with Strong Buy stocks outperforming more than any other rank.
Should You Consider Semtech?The last thing we will do today, now that we have a grasp on the ESP and how powerful of a tool it can be, is to quickly look at a qualifying stock. Semtech (SMTC - Free Report) holds a #3 (Hold) at the moment and its Most Accurate Estimate comes in at $0.47 a share 13 days away from its upcoming earnings release on May 26, 2026.
Semtech's Earnings ESP sits at +3.68%, which, as explained above, is calculated by taking the percentage difference between the $0.47 Most Accurate Estimate and the Zacks Consensus Estimate of $0.45. SMTC is also part of a large group of stocks that boast a positive ESP. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
SMTC is part of a big group of Computer and Technology stocks that boast a positive ESP, and investors may want to take a look at Roper Technologies (ROP - Free Report) as well.
Slated to report earnings on July 20, 2026, Roper Technologies holds a #2 (Buy) ranking on the Zacks Rank, and its Most Accurate Estimate is $5.34 a share 68 days from its next quarterly update.
Roper Technologies' Earnings ESP figure currently stands at +0.31% after taking the percentage difference between its Most Accurate Estimate and its Zacks Consensus Estimate of $5.32.
Because both stocks hold a positive Earnings ESP, SMTC and ROP could potentially post earnings beats in their next reports.
Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>
Wall Street analysts forecast that Semtech (SMTC - Free Report) will report quarterly earnings of $0.45 per share in its upcoming release, pointing to a year-over-year increase of 18.4%. It is anticipated that revenues will amount to $283.27 million, exhibiting an increase of 12.8% compared to the year-ago quarter.
The current level reflects no revision in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial projections over this period.
Prior to a company's earnings release, it is of utmost importance to factor in any revisions made to the earnings projections. These revisions serve as a critical gauge for predicting potential investor behaviors with respect to the stock. Empirical studies consistently reveal a strong link between trends in earnings estimate revisions and the short-term price performance of a stock.
While investors typically use consensus earnings and revenue estimates as a yardstick to evaluate the company's quarterly performance, scrutinizing analysts' projections for some of the company's key metrics can offer a more comprehensive perspective.
Given this perspective, it's time to examine the average forecasts of specific Semtech metrics that are routinely monitored and predicted by Wall Street analysts.
Analysts predict that the 'Net Sales by major end markets- High-End Consumer' will reach $39.88 million. The estimate points to a change of +12.6% from the year-ago quarter.
The consensus among analysts is that 'Net Sales by major end markets- Industrial' will reach $150.88 million. The estimate indicates a change of +5.7% from the prior-year quarter.
The combined assessment of analysts suggests that 'Net Sales by major end markets- Infrastructure' will likely reach $92.34 million. The estimate indicates a year-over-year change of +26.8%.
Based on the collective assessment of analysts, 'Net Sales by reportable segment- Signal Integrity' should arrive at $98.28 million. The estimate indicates a change of +33.7% from the prior-year quarter.
The consensus estimate for 'Net Sales by reportable segment- Analog Mixed Signal and Wireless' stands at $97.90 million. The estimate points to a change of +8% from the year-ago quarter.
According to the collective judgment of analysts, 'Net Sales by reportable segment- IoT Systems and Connectivity' should come in at $86.64 million. The estimate indicates a change of -0.3% from the prior-year quarter.
View all Key Company Metrics for Semtech here>>>
Shares of Semtech have experienced a change of +30.3% in the past month compared to the +3.3% move of the Zacks S&P 500 composite. With a Zacks Rank #2 (Buy), SMTC is expected to outperform the overall market in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Key Takeaways Semtech expects Q1 FY27 revenues of about $283M, with EPS of 45 cents.Semtech sees strong demand for FiberEdge and CopperEdge products tied to AI infrastructure.SMTC expects semiconductor products' gross margin to decline in Q1 due to HieFo acquisition ramp costs. Semtech Corporation (SMTC - Free Report) is scheduled to report first-quarter fiscal 2027 results on May 26.
For the fiscal first quarter, Semtech anticipates revenues to be $283 million (+/- $5 million). The Zacks Consensus Estimate for revenues is pegged at $283.3 million, indicating a rise of 12.8% from the year-ago quarter.
SMTC anticipates non-GAAP earnings per share to be 45 cents (+/- 3 cents). The consensus mark for the same is pegged at 45 cents, unchanged over the past 60 days, indicating a rise of 18.4% from the year-ago quarter.
The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, while matching once, the average surprise being 3.5%.
Let’s see how things are shaping up for this announcement.
Factors Likely to Influence SMTC’s Q1 ResultsSemtech’s fiscal first-quarter performance is expected to have benefited from continued strength in its infrastructure end markets, driven by growing demand across hyperscale data center applications. Strong adoption of SMTC’s FiberEdge transimpedance amplifiers and CopperEdge products for Active Copper Cable applications is likely to have aided the company’s prospects in the first quarter. Increasing AI infrastructure investments and rising deployments of 800G and 1.6T architectures are also expected to have driven demand for Semtech’s optical and copper interconnect solutions.
SMTC expects revenues from the infrastructure end market to increase sequentially and projects data center revenues to grow 12% on a sequential basis. The Zacks Consensus Estimate for revenues from the infrastructure end market is pegged at $92.3 million, indicating sequential growth of 11.6%.
Semtech’s first quarter prospects are likely to have benefited from improving seasonal trends in the high-end consumer market, supported by market share gains in TVS products and contributions from its recently acquired force sensing portfolio. SMTC expects revenues from the high-end consumer end market to increase 9% on a sequential basis. The Zacks Consensus Estimate for revenues from high-end consumer market is pegged at $39.9 million, indicating growth of 9% on a sequential basis.
Strong Momentum across its Signal Integrity and Analog Mixed Signal & Wireless product lines is expected to have contributed well. The company’s wireless business is expected to have benefited from expanding 5G offerings and increasing carrier readiness of its 5G solutions. The Zacks Consensus Estimate for revenues from the Signal Integrity segment is pegged at $98 million, indicating growth of 7.7% on a sequential basis. The Zacks Consensus Estimate for revenues from the Analog Mixed Signal & Wireless segment is pegged at $98 million, indicating growth of 4.3% on a sequential basis.
However, softness in the industrial end-market and IoT Systems and Connectivity business is likely to have weighed on the company’s prospects in the fiscal first quarter. SMTC expects net revenues from the industrial end market to remain flat in the first quarter. The Zacks Consensus Estimate for revenues from the industrial end market is pegged at $151 million, remaining flat on a sequential basis. The consensus estimate for revenues from the IoT Systems and Connectivity segment is pegged at $87 million, indicating a sequential decline of 3.3%.
Further, management also guided total semiconductor products’ gross margin to contract 130 basis points sequentially to 60.4% in the first quarter of fiscal 2027, attributing the decline to initial ramp costs related to the HieFo acquisition. This is likely to have weighed on the company’s gross margins in the first quarter.
What Our Proven Model Says for SMTC’s Q1 EarningsAccording to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Semtech has an Earnings ESP of 0.00% and carries a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to ConsiderHere are some stocks you may want to consider in the Zacks Computer and Technology sector, as our model shows that these have the right combination of elements to post an earnings beat:
Dell Technologies (DELL - Free Report) has an Earnings ESP of +3.51% and carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dell Technologies is set to report first-quarter fiscal 2027 results on May 28. The Zacks Consensus Estimate for Dell Technologies’ first-quarter fiscal 2027 earnings is pegged at $3.00 per share, up by 3 cents over the past seven days, indicating a rise of 93.6% from the year-ago quarter’s reported figure.
Salesforce, Inc. (CRM - Free Report) has an Earnings ESP of +0.15% and carries a Zacks Rank #2 at present.
Salesforce is scheduled to report first-quarter fiscal 2027 results on May 27. The Zacks Consensus Estimate for Salesforce’s first-quarter fiscal 2027 earnings is pegged at $3.12 per share, unchanged over the past 30 days, indicating a rise of 20.9% from the year-ago quarter’s reported figure.
Autodesk (ADSK - Free Report) has an Earnings ESP of +0.35% and carries a Zacks Rank of 3 at present.
Autodesk is slated to report first-quarter fiscal 2027 results on May 28. The Zacks Consensus Estimate for ADSK’s first-quarter fiscal 2027 earnings is pegged at $2.84 per share, unchanged over the past 30 days, indicating a rise of 24% from the year-ago quarter’s reported figure.
On May 21, 2026, Semtech Corp SMTC shares rose 3.3% today, reaching a current price of $146.53. Over the last month, the stock has rallied significantly, recording a 41.6% increase, while year-to-date performance stands at an impressive 98.8%. The stock has experienced a substantial rise over the past year, gaining 280.5%, with a 52-week high of $149.52 and a low of $34.59.
GF Value™ verdict: Current price of $146.53 is 317.1% above GF Value™ of $35.13, indicating overvaluation.GF Score™ of 69/100 suggests an above-average rating, indicating potential for long-term returns.Most notable signal: Insiders sold $3.2M worth of shares in the last three months, with no buying activity. Is SMTC Overvalued or Undervalued? According to the GF Value™, Semtech Corp currently appears significantly overvalued with a fair value estimation of $35.13 compared to its trading price of $146.53. This represents a margin of safety of -317.1%, indicating a high level of risk associated with the current stock price. The GF Valuation label further confirms this perspective, categorizing the stock as significantly overvalued. Investors considering this stock should be cautious, as the considerable disparity between the market price and intrinsic value could suggest potential correction in the future.
GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. Given the stark contrast between Semtech's current price and its estimated intrinsic value, investors may need to reassess their expectations regarding future price appreciation and potential downside risks.
How Does SMTC's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 66.1x 37.0x Semtech's current forward P/E of 66.1x is significantly higher than its 5-year median P/E of 37.0x. This analysis indicates that the stock is trading above its historical valuation metrics, which aligns with the GF Value™ conclusion of overvaluation. The elevated P/E ratio suggests that the market has high expectations for future earnings, but such high multiples can lead to increased vulnerability to earnings disappointments.
What Does SMTC's GF Score™ Tell Us? Metric Rating GF Score™ 69 Financial Strength 7/10 Profitability 6/10 Growth 6/10 Valuation 1/10 Momentum 9/10 The GF Score™ of 69/100 reflects an above-average rating, indicating potential for long-term returns. The strongest area for Semtech lies in its momentum rank of 9/10, suggesting positive price trends and investor interest. However, the valuation rank of 1/10 highlights the significant concern regarding its current market price relative to intrinsic value, suggesting that while financial strength and profitability are acceptable, the overvaluation may pose risks to future performance.
What Are Insiders Doing with SMTC Stock? Recent insider activity for Semtech shows that insiders have sold $3.2 million worth of shares in the last three months, with no buying activity reported. This pattern of selling could indicate a lack of confidence from management regarding the stock's future performance or a desire to capitalize on the recent price increases. Such selling can be a red flag for potential investors, as it may suggest that insiders believe the stock is overvalued at current levels.
What This Means for Investors Based on the GF Value™ assessment, Semtech Corp is currently overvalued. The significant gap between the market price and the estimated intrinsic value raises concerns about potential downside risks as the market corrects itself. Investors are advised to carefully evaluate their positions in light of these valuations and insider activities.
For the complete analysis, visit the Semtech Corp SMTC stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is SMTC's GF Score™?
SMTC has a GF Score™ of 69/100, indicating an above-average rating that suggests potential for long-term returns based on historical performance.
Is SMTC overvalued or undervalued?
SMTC is currently deemed overvalued according to GF Value™, with its price significantly above the estimated intrinsic value, indicating a potential risk for investors.
What is SMTC's P/E ratio?
SMTC's forward P/E ratio stands at 66.1x, which is higher than its 5-year median P/E of 37.0x, confirming the stock's overvaluation relative to its historical earnings multiples.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Chipmaker Semtech (SMTC) late Tuesday beat analyst estimates for its fiscal first quarter and with its guidance for the current quarter. Semtech stock rose in extended trading.
The Camarillo, Calif.-based company earned an adjusted 51 cents a share on sales of $291 million in the quarter ended April 26. Analysts polled by FactSet had expected earnings of 45 cents a share on sales of $283.5 million. On a year-over-year basis, Semtech earnings increased 34% while sales rose 16%.
↑ X NOW PLAYING The AI Inference Pivot: Why 2026 Could Be The Most Complex Chip Cycle In Decades
For the current quarter, Semtech forecast adjusted earnings of 61 cents a share on sales of $328 million. Wall Street was modeling earnings of 52 cents a share on sales of $300.7 million for fiscal Q2. In the same quarter last year, it earned an adjusted 41 cents a share on sales of $257.6 million.
Semtech is a provider of chips for data center networking, Internet of Things connectivity and cellular infrastructure solutions. Lately it has gotten a lift from sales of high-bandwidth, low-power chips and networking gear for AI data centers.
Semtech Stock Is A Recent Breakout In after-hours trading on the stock market today, Semtech stock climbed nearly 6% to 174. During the regular session Tuesday, Semtech stock rose 4.9% to close at 164.46. Earlier in the day, it hit a regular-session record high of 168.29.
"Semtech is off to an exceptional start in fiscal year 2027, delivering record quarterly results and expanding design wins across our data center and LoRa businesses," Chief Executive Hong Hou said in a news release. "As FiberEdge and CopperEdge 1.6T revenues layer onto our strong growth base, we expect data center growth to accelerate throughout the year."
He added, "The strength and depth of our bookings and backlog, a broad and well-positioned product portfolio, and targeted R&D investments aligned to customer roadmaps give us strong conviction in our growth trajectory ahead."
On April 16, Semtech stock broke out of a cup base at buy point of 96.46, according to IBD MarketSurge charts.
Follow Patrick Seitz on X at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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SMTC stock is moving. Watch the price action here. Semtech Q1 Details Semtech reported quarterly earnings of 51 cents per share, which beat the consensus estimate of 45 cents, according to Benzinga Pro data.
Quarterly revenue came in at $291 million, which beat the analyst consensus estimate of $283.45 million and was up from $251.1 million in the same period last year.
“Semtech is off to an exceptional start in fiscal year 2027, delivering record quarterly results and expanding design wins across our data center and LoRa businesses,” said CEO Hong Hou.
Looking AheadSemtech expects second-quarter adjusted EPS of 59 cents to 63 cents, versus the 51 cent analyst estimate, and revenue in a range of $323 million to $333 million, versus the $300.63 million estimate.
SMTC Stock Price: According to data from Benzinga Pro, Semtech stock was up 5.31% to $172 in Tuesday's extended trading.
Photo: Shutterstock
Market News and Data brought to you by Benzinga APIs
How Semtech’s Data Center Chips Are Powering the AI BoomSemtech NASDAQ: SMTC reported record quarterly revenue for its first quarter of fiscal 2027, driven by strength in its data center and LoRa businesses, and issued a second-quarter outlook that calls for continued acceleration across its major segments.
President and Chief Executive Officer Hong Hou said the company delivered “an exceptional start” to fiscal 2027, with revenue of $291 million for the quarter ended April 26, 2026. That was up 6% sequentially and 16% year over year. Adjusted diluted earnings per share were $0.51, up 34% from the prior year.
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Why Semtech Stock Is Rallying After Its NVIDIA Setback“We drove strong sequential and year-over-year revenue and earnings growth, expanded our data center and the LoRa design win pipeline, all while advancing our R&D and strategic initiatives,” Hou said.
Chief Financial Officer Mark Lin said the quarter marked Semtech’s ninth consecutive quarter of net sales growth. Adjusted gross margin was 53%, while total semiconductor products gross margin was 60.7%, reflecting a favorable mix from the company’s data center and LoRa portfolios. Adjusted operating income was $59.3 million, adjusted operating margin was 20.4%, and adjusted EBITDA was $66.4 million.
Data Center Demand Drives Infrastructure Growth Semtech: Bullish Market Forces Come Into Alignment for This StockSemtech’s infrastructure net sales were $98.8 million, up 14% sequentially and 36% year over year. Data center net sales reached a record $71.6 million, up 14% sequentially and 39% from the year-ago period.
Hou attributed the data center performance to strong demand across the company’s portfolio, particularly its 800G FiberEdge products. He said demand for Semtech’s transimpedance amplifier, or TIA, solutions was “exceptionally strong” across a broad range of transceiver programs. He also said established and emerging module suppliers had qualified Semtech for new sockets, including some sole-source positions.
The company also cited momentum in 800G linear pluggable optics, or LPO, and said its FiberEdge linear TIA and driver solutions are deployed by several leading hyperscalers in the U.S. and China. Hou said Semtech expects its 800G foundation to support revenue growth this year, with 1.6T shipments launching in the second quarter and gaining momentum in the second half.
On the copper side, Hou said Semtech began shipping CopperEdge 1.6T integrated circuits in the first quarter to cable partners for deployment at a U.S. hyperscaler. He said active copper cable, or ACC, products continue to gain traction as customers evaluate them against incumbent solutions.
During the question-and-answer portion of the call, Hou said capacity remains critical in the current environment. “This is a time capacity is king,” he said, adding that Semtech began working on availability about 18 months ago. He said the company can support drop-in orders and is working with foundry and outsourced semiconductor assembly and test partners to further expand capacity.
LoRa Business Enters New Growth Phase Industrial net sales were $153.9 million, up 2% sequentially and 8% year over year. LoRa-enabled net sales were $44.9 million, up 12% from the prior quarter and 14% from the year-ago period.
Hou said LoRa growth was supported by applications including smart utilities, smart buildings, smart cities and asset management. He said Semtech’s fourth-generation LoRa platform expands throughput to 2.6 Mbps while retaining low power consumption, sensitivity and protocol flexibility.
He described three pillars for the low-power connectivity business: LoRaWAN for industrial and commercial deployments, LoRa Plus for smart home and security markets, and Amazon Sidewalk for mass-market consumer applications. For the second quarter, Semtech is targeting LoRa revenue at an all-time high, with more than 15% sequential quarterly growth.
In the Q&A session, Hou said growth has increasingly included gateway expansion, which he said indicates customers are adding capacity and coverage to support more end-node applications. He also identified edge AI as a potential “wild card” opportunity for LoRa.
Consumer and IoT Businesses Show Mixed Trends High-end consumer net sales were $38.4 million, up 5% sequentially and 8% year over year. Hou said Semtech’s transient voltage suppressor, or TVS, business continued to outpace underlying handset volumes, helped by share gains and content expansion at premium handset manufacturers.
He also highlighted the company’s SurgeSwitch solution for high-voltage power delivery applications and said Semtech continues to expand PerSe capacitive sensor design wins.
IoT systems and connectivity net sales were $88.3 million, down 2% sequentially but up 2% year over year. Hou said the newly released AirLink RX400 and AirLink EX400 routers were receiving strong customer feedback, particularly for mission-critical low-power 5G cellular applications.
Portfolio Optimization and Hyfo Acquisition Hou said the divestiture process for Semtech’s cellular module business is in its final stages, with discussions focused on transition and integration matters. He said the company remains confident the business represents a compelling opportunity for the right acquirer.
Semtech also discussed the Hyfo acquisition, completed in March. Hou said Hyfo’s indium phosphide photonic products are reported in the data center end market and are strategic building blocks for 1.6T and 3.2T optical modules. He said demand for gain chips currently exceeds supply, though capacity expansion plans remain on schedule.
In response to an analyst question, Hou said aggregate demand for gain chips could outpace current capacity by about three times. He said Semtech expects to increase capacity by about three to four times by the end of the year, and by another three to four times by the end of next year.
Second-Quarter Outlook Calls for Further Growth For the second quarter of fiscal 2027, Semtech expects net sales of $328 million, plus or minus $5 million. At the midpoint, that would represent 13% sequential growth and 27% year-over-year growth.
The company expects data center revenue to grow 35% sequentially in the second quarter, supported by accelerating shipments of 800G and 1.6T components. Hou said that would represent 85% growth over the same period last year.
Lin said Semtech expects adjusted gross margin of 54%, plus or minus 50 basis points, and total semiconductor products gross margin of 62.1%, plus or minus 50 basis points. Adjusted operating margin is expected to reach 21.9% at the midpoint, while adjusted EBITDA is expected to be $79.2 million, plus or minus $2.3 million.
Semtech projected adjusted diluted earnings per share of $0.61, plus or minus $0.02, based on a weighted average share count of 97.7 million. At the midpoint, that would be up 20% sequentially and 49% year over year.
Hou said the company expects accelerating demand through fiscal 2027 and beyond, supported by backlog, bookings and new product ramps. “Our data center business is firing on all cylinders,” he said. “LoRa is entering a new chapter of growth.”
About Semtech NASDAQ: SMTCSemtech Corporation is a leading supplier of high-performance analog and mixed-signal semiconductors and advanced algorithms. The company's products address a broad range of applications in the Internet of Things (IoT), data center and telecom, industrial, home automation, automotive, and aerospace markets. Semtech's portfolio includes power management, signal integrity, protection devices, wireless and sensing technologies that enable smarter, more connected systems worldwide.
A core offering from Semtech is its LoRa® technology, a low-power, long-range wireless communication platform that has become a de facto standard for global IoT deployments.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Semtech (SMTC - Free Report) came out with quarterly earnings of $0.51 per share, beating the Zacks Consensus Estimate of $0.45 per share. This compares to earnings of $0.38 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of +12.51%. A quarter ago, it was expected that this chipmaker would post earnings of $0.43 per share when it actually produced earnings of $0.44, delivering a surprise of +2.33%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Semtech, which belongs to the Zacks Semiconductor - Analog and Mixed industry, posted revenues of $291 million for the quarter ended April 2026, surpassing the Zacks Consensus Estimate by 2.73%. This compares to year-ago revenues of $251.1 million. The company has topped consensus revenue estimates four times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Semtech shares have added about 112.8% since the beginning of the year versus the S&P 500's gain of 9.2%.
What's Next for Semtech?While Semtech has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Semtech was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.52 on $299.49 million in revenues for the coming quarter and $2.20 on $1.22 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Semiconductor - Analog and Mixed is currently in the top 3% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Another stock from the broader Zacks Computer and Technology sector, Accenture (ACN - Free Report) , has yet to report results for the quarter ended May 2026. The results are expected to be released on June 18.
This consulting company is expected to post quarterly earnings of $3.68 per share in its upcoming report, which represents a year-over-year change of +5.4%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.
Accenture's revenues are expected to be $18.73 billion, up 5.7% from the year-ago quarter.
Semtech (SMTC - Free Report) reported $291 million in revenue for the quarter ended April 2026, representing a year-over-year increase of 15.9%. EPS of $0.51 for the same period compares to $0.38 a year ago.
The reported revenue represents a surprise of +2.73% over the Zacks Consensus Estimate of $283.27 million. With the consensus EPS estimate being $0.45, the EPS surprise was +12.51%.
While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how Semtech performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
Net Sales by reportable segment- IoT Systems and Connectivity: $88.3 million compared to the $86.64 million average estimate based on two analysts. The reported number represents a change of +1.6% year over year.Net Sales by reportable segment- Signal Integrity: $102 million compared to the $98.28 million average estimate based on two analysts. The reported number represents a change of +38.7% year over year.Net Sales by reportable segment- Analog Mixed Signal and Wireless: $100.8 million versus $97.9 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +11.2% change.View all Key Company Metrics for Semtech here>>>
Shares of Semtech have returned +54.8% over the past month versus the Zacks S&P 500 composite's +4.4% change. The stock currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term.
On May 26, 2026, Semtech Corp SMTC shares rose 4.9% to a current price of $164.43. The stock has demonstrated impressive price performance, with a 52-week range between $34.59 and $168.29.
GF Value™ verdict: The current price is $164.43, compared to a GF Value™ of $35.30, indicating a 365.8% overvaluation. GF Score™: 69/100, which suggests an above-average potential for long-term returns. Notable signal: Insider activity shows that insiders sold $3.2M in shares over the last three months, with no buying activity recorded. Is SMTC Overvalued or Undervalued? According to the GF Value™ metric, Semtech Corp is significantly overvalued at its current price of $164.43 compared to the intrinsic value estimate of $35.30. This presents a substantial margin of safety issue, as the stock is priced at an astounding 365.8% above its calculated fair value. The GF Valuation label indicates a clear signal of overvaluation, which suggests that the current market price may not be sustainable and poses a risk for potential investors.
The wide disparity between the current market price and the GF Value™ indicates that Semtech Corp's share price may be driven more by investor sentiment and momentum rather than fundamentals. This overvaluation poses significant risks, as a market correction could lead to a swift decline in stock price if the company's performance does not support such a high valuation.
How Does SMTC's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 74.2x 37.0x Currently, Semtech Corp's forward P/E is 74.2x, which is significantly above its 5-year median P/E of 37.0x. This analysis indicates that the stock is trading well above its historical valuation levels, which aligns with the GF Value™ verdict of overvaluation. The elevated P/E ratio further reinforces the cautionary stance on the stock's current valuation, suggesting that investors may face substantial risk if the market corrects itself.
What Does SMTC's GF Score™ Tell Us? Metric Rating GF Score™ 69/100 Financial Strength 7/10 Profitability 6/10 Growth 6/10 Valuation 1/10 Momentum 9/10 The GF Score™ of 69/100 indicates that Semtech Corp has a solid overall rating, driven primarily by strong financial strength (7/10) and high momentum (9/10). However, the valuation rank is notably weak at 1/10, which aligns with the findings from the GF Value™ analysis, indicating a significant overvaluation. The profitability and growth rankings are average (6/10), suggesting that while the company is performing well, the price may not reflect its true intrinsic value.
What Are Insiders Doing with SMTC Stock? Recent insider activity for Semtech Corp reveals that insiders sold $3.2 million worth of shares over the past three months, with no buying activity reported during this period. This trend may suggest a lack of confidence from insiders regarding the company’s current valuation and future performance. The absence of insider buying further corroborates the concerns raised by the significant overvaluation indicated by GF Value™.
What This Means for Investors Overall, Semtech Corp SMTC is currently overvalued based on the GF Value™ assessment, which indicates a substantial margin of overvaluation at 365.8%. This suggests that investors should exercise caution, as the stock may be vulnerable to a correction if the intrinsic value does not align with market sentiment.
For the complete analysis, visit the Semtech Corp SMTC stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is SMTC's GF Score™?
SMTC's GF Score™ is 69/100, indicating above-average potential for long-term returns based on various financial metrics.
Is SMTC overvalued or undervalued?
According to the GF Value™ verdict, SMTC is overvalued, priced significantly above its intrinsic value, which suggests caution for potential investors.
What is SMTC's P/E ratio?
SMTC's forward P/E ratio is 74.2x, which is considerably higher than its 5-year median P/E of 37.0x, indicating a significant overvaluation compared to its historical levels.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Semtech Corporation (SMTC - Free Report) used its first-quarter fiscal 2027 earnings call to make a broader point than the headline numbers alone. Management argued that design wins, backlog and supply preparation are setting up a faster growth year, led by data center products and supported by renewed LoRa momentum.
The message that mattered most was forward-looking. Executives pointed to rising optical and copper deployments, a stronger second-quarter outlook and improving visibility into the back half of the year.
SMTC Leans Into AI ConnectivityPresident and CEO Hong Hou framed the quarter as an early sign that Semtech’s portfolio work and customer engagement are translating into larger opportunities across hyperscale networking.
He said record data center revenue of $71.6 million was driven by broad demand for 800-gig FiberEdge products, with linear pluggable optics gaining traction in both the United States and China. He also said the company won additional sockets, including some sole-source positions, as customers pushed ahead with major deployments.
Hou tied that momentum to what comes next. He said 1.6T shipments are starting in the second quarter and should build in the second half, supported by significant bookings and backlog.
Semtech Builds the Next Optical LayerHou spent much of the call connecting Semtech’s current optical strength to future architectures. He said major module makers have adopted Semtech parts for 1.6T transceivers using the latest DSPs, while hyperscalers are showing more conviction around LRO and LPO because of power savings.
He also pointed to the March HieFo acquisition as a strategic extension of that roadmap. Gain chips and related indium phosphide photonic products, he said, position Semtech more deeply in 1.6T and 3.2T modules as well as coherent and next-generation optical systems.
That framing suggested management is trying to move investor focus beyond a single product cycle. Hou described Semtech as building a broader platform across scale-up, scale-out and scale-across interconnects.
SMTC Keeps LoRa as a Second EngineThe industrial business did not carry the same headline effect as the data center, but management made clear that LoRa remains an important growth pillar. Industrial revenue rose to $153.9 million, while LoRa-enabled sales reached $44.5 million.
Hou said LoRa growth is broadening across smart utilities, smart buildings, smart cities and asset tracking. He also highlighted the fourth-generation LoRa platform, which lifts throughput to 2.6 megabits per second while preserving low-power and long-range advantages.
In the Q&A, Hou added more durability to that thesis. A Baird analyst asked about medium-term LoRa growth, and he said the company is seeing gateway expansion on top of growing end-node deployments, with added upside from security, smart-building and Amazon Sidewalk applications.
Semtech Spends for Programs, Not OverheadExecutive vice president and CFO Mark Lin used the call to show that stronger growth is not coming at the expense of margin discipline. First-quarter adjusted gross margin reached 53%, while adjusted operating margin rose to 20.4%.
Lin said the second-quarter outlook calls for more R&D spending, especially in data center and LoRa, but with SG&A falling as a percentage of revenue. He described that mix as deliberate, with incremental spending aimed at high-conviction programs rather than broader overhead expansion.
That operating profile also supported a better near-term financial setup. Semtech reported adjusted EPS of $0.51, beating the Zacks Consensus Estimate of $0.45 by 12.5%, while revenue of $291 million topped the consensus estimate of $283.27 million by 2.7%.
SMTC Q&A Shows More ConfidenceThe clearest tone shift came during analyst questioning, where Hou sounded more emphatic about duration and visibility. An Oppenheimer analyst asked whether supply could limit upside, and Hou said the company had already spent roughly 18 months preparing capacity and is now working to double or triple current levels.
A Needham analyst pressed on whether data center growth could exceed management’s earlier floor. Hou said he did not want to cap the opportunity and pointed to visibility, backlog and bookings as support for faster second-half growth.
Questions from Susquehanna, Benchmark and Stifel also pulled out the same theme. Hou described demand as broad-based across 800-gig, 1.6T, LPO, LRO, CopperEdge and lasers, rather than concentrated in one module maker or one narrow product ramp.
Semtech Exits the Call on Expansion PlansThe company’s second-quarter guide reinforced the call’s main message. Semtech expects revenue of $328 million, plus or minus $5 million, and adjusted EPS of $0.61, plus or minus $0.02, with growth projected across all three segments.
Hou’s closing posture was centered on execution rather than celebration. He emphasized supporting customer ramps, intensifying R&D in coherent light, CPO, LoRa and sensors, and finishing the early steps of portfolio optimization, including the cellular module divestiture process.
Zacks Signals Point to a Mixed SetupSMTC carries a Zacks Rank #2 (Buy), which under the Zacks framework reflects favorable earnings estimate revision trends and generally supportive near-term performance prospects. That positive rank stands out more than the stock’s individual style profile. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Style Scores are mixed, with an F for Value, an A for Growth, an F for Momentum and a VGM Score of C. In practice, that points to stronger growth characteristics than value or momentum support. The Zacks Rank remains the primary signal, and it can change as analysts revise estimates after the quarter’s results.
Semtech stock is approaching key resistance levels. What’s driving SMTC to record levels? Q1 HighlightsSemtech reported adjusted earnings per share of 51 cents, beating the consensus estimate of 45 cents. In addition, it reported revenue of $291.00 million, beating the consensus estimate of $283.44 million.
"Semtech is off to an exceptional start in fiscal year 2027, delivering record quarterly results and expanding design wins across our data center and LoRa businesses," said President and CEO Hong Hou.
Hou said the company expects data center growth to accelerate throughout the year as FiberEdge and CopperEdge 1.6T revenues build on existing growth momentum.
"The strength and depth of our bookings and backlog, a broad and well-positioned product portfolio, and targeted R&D investments aligned to customer roadmaps give us strong conviction in our growth trajectory ahead," Hou said.
Executive Vice President and CFO Mark Lin said the company demonstrated "meaningful operating leverage" in the first quarter and noted that strong operational fundamentals support improving metrics reflected in the company's second-quarter outlook.
GuidanceSemtech expects second-quarter adjusted EPS of 59 cents to 63 cents, versus the 51 cent consensus estimate, and revenue in a range of $323 million to $333 million, versus the $300.63 million estimate.
Analyst Consensus & Recent ActionsThe stock carries a Buy rating with an average price target of $147.50. Recent analyst moves include:
Needham: Buy (Raises Target to $200.00) (May 27) Baird: Outperform (Raises Target to $225.00) (May 27) Overbought Conditions Emerge As Rally AcceleratesSemtech is extending a powerful long-term uptrend, up 324.08% over the past 12 months, and Wednesday's premarket push is keeping price well above every major moving average. The stock is trading 45.4% above its 20-day SMA ($127.60) and 132.7% above its 200-day SMA ($79.73), which is classic "extended trend" behavior rather than a mean-reversion setup.
Momentum is the key story right now: RSI is 78.93, which flags an overbought condition and tells you the move is getting stretched versus its recent pace. Overbought doesn't automatically mean "sell," but it does raise the odds of sharp pullbacks or sideways digestion if buyers stop pressing.
From a trend-structure standpoint, the 20-day SMA remains above the 50-day SMA (bullish), and the stock is still benefiting from the golden-cross backdrop (50-day SMA above the 200-day SMA) that formed in August 2025. The most recent swing high and the 52-week high were set in May, and the stock is now trading above that prior 52-week high ($168.29), turning an old ceiling into a potential reference point for dip-buyers.
Key Resistance: $180.50 — the stock is pressing into fresh highs above the prior 52-week peak, so price discovery is the main friction point Key Support: $168.29 — the prior 52-week high zone is the nearest obvious "breakout retest" level if the gap cools Semtech Stock SoarsSMTC Price Action: At the time of publication, Semtech shares are trading 12.51% higher at $185.03, according to data from Benzinga Pro.
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Key Takeaways Semtech posted Q1 FY27 EPS of 51 cents, up about 34.2% Y/Y and beating estimates.SMTC revenues rose 16% to $291M, led by 36% growth in infrastructure.SMTC guides Q2 FY27 revenues of about $328M and EPS near 61 cents per share. Semtech Corporation (SMTC - Free Report) shares gained 8.5% during Tuesday’s extended trading session after the company reported better-than-expected first-quarter fiscal 2027 results.
Semtech posted non-GAAP earnings of 51 cents per share, which beat the Zacks Consensus Estimate by 13.3%. The bottom line exceeded the management’s guidance of 45 cents (+/- 3 cents) and reflected a robust year-over-year improvement of approximately 34.2%.
Semtech beat on earnings in each of the trailing four quarters, the average surprise being 6.8%.
SMTC’s first-quarter fiscal 2027 revenues of $291 million topped the Zacks Consensus Estimate by 2.7% and came above management’s guidance of $283 million (+/- $5 million). The top line jumped 16% year over year, with solid growth across all of its end markets, particularly in data centers.
Semtech’s Q1 Revenues in Terms of End MarketsThe company’s top-line performance can be attributed to the impressive year-over-year rise in its end markets.
Sales from the infrastructure market totaled $98.8 million (33.9% of net sales), exhibiting year-over-year growth of 36%, supported by the expanding data center business. A key highlight was record data center net sales of $71.6 million, rising 39% year over year, reflecting continued strength in high-speed interconnect solutions.
Sales from the industrial market amounted to $153.9 million (52.9% of net sales), up 8% year over year.
Sales from the high-end consumer market totaled $38.4 million (13.2% of net sales), up 8% year over year, as the company cited resilience and continued design win momentum.
SMTC's LoRa Growth Adds Another EngineLoRa-enabled net sales were $44.5 million, up 12% sequentially and 14% year over year, reflecting broader adoption across smart utilities, smart buildings, smart cities and asset management.
The company is positioning its fourth-generation LoRa platform to expand use cases by combining dual-band capability with higher data throughput, while maintaining the low-power attributes that underpin long-battery-life deployments.
SMTC’s Q1 Revenues in Terms of Product LinesSignal Integrity (35.1% of net sales) sales totaled $102 million, up 38.8% year over year. Analog Mixed Signal & Wireless (34.6% of net sales) sales amounted to $100.8 million, which rose 11.3% year over year.
IoT System and Connectivity (30.3% of net sales) sales totaled $88.3 million, up 1.6% on a year-over-year basis.
Semtech’s Margins in DetailsThe non-GAAP gross margin of 53% contracted 50 basis points (bps) on a year-over-year basis and expanded 140 bps sequentially.
Non-GAAP operating income increased 24.6% year over year to $59.3 million. The non-GAAP operating margin expanded to 20.4% from 19% reported in the year-ago quarter. On a quarter-over-quarter basis, non-GAAP operating income increased 18.6%, while margin expanded 220 basis points.
Semtech’s Balance Sheet & Cash FlowAs of April 26, 2026, cash and cash equivalents totaled $163.3 million, down from $195.2 million as of Jan. 25, 2026.
The long-term debt amounted to $492 million, up from the previous quarter’s reported figure of $491.2 million.
During the first quarter, Semtech generated operating cash flow and free cash flow of $36.2 million and $28 million, respectively.
Semtech Initiates Q2 FY27 GuidanceFor the second quarter of fiscal 2027, Semtech expects net sales to be $328 million (+/- $5 million). The Zacks Consensus Estimate is pegged at $299.5 million, indicating a year-over-year rise of 16.3%.
The non-GAAP gross margin is expected to be 54% (+/- 50 bps). The non-GAAP operating margin is anticipated to be 21.9% (+/- 40 bps).
Non-GAAP earnings are expected to be 61 cents (+/- 2 cents) per share. The consensus mark for earnings is pegged at 52 cents per share, indicating a year-over-year rise of 26.8%.
SMTC’s Zacks Rank and Other Stocks to ConsiderCurrently, Semtech carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Applied Materials (AMAT - Free Report) , Celestica (CLS - Free Report) and Amphenol (APH - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Applied Materials have gained 77.1% year to date. The Zacks Consensus Estimate for Applied Materials’ fiscal 2026 earnings is pegged at $12.02 per share, up 9 cents over the past seven days, indicating a year-over-year surge of 27.6%.
Shares of Celestica have gained 25.1% year to date. The Zacks Consensus Estimate for Celestica’s 2026 earnings is pegged at $10.16 per share, up 15.1% over the past 30 days, indicating a year-over-year jump of 67.9%.
Amphenol shares have jumped 3.3% year to date. The Zacks Consensus Estimate for APH’s 2026 earnings is pegged at $4.76 per share, up 11.4% over the past 30 days, indicating a year-over-year increase of 42.5%.
Semtech NASDAQ: SMTC has emerged as a critical AI play for several reasons. At face value, its data center products are crucial for connectivity and networking; they unlock the power of hardware, efficiently linking servers, large clusters, racks, and data centers. The bigger picture is more impressive. Not only is Semtech well-positioned for data center growth, but it is also well-positioned for telecommunications and the Internet of Things (IoT), which enable the application of AI at the edge.
Semtech Today
$163.57 +9.29 (+6.02%)
As of 06/11/2026 04:00 PM Eastern
52-Week Range$39.07▼
$172.35Price Target$179.73
The company's recent earnings report showed that business is good across product lines, particularly in data centers, a trend expected to accelerate.
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Takeaways from other leading AI names include the impact of AI infrastructure spending, which leads to applications, new use cases, and increased demand.
With this in play, investors can only expect Semtech’s three business specialties to continue strengthening and to persist for the foreseeable future.
In this scenario, Semtech’s consensus forecasts are far too low, setting the stage for a persistent cycle of outperformance and analyst upgrades.
Semtech’s Blowout Q1 Confirms AI Spend Is RealSemtech’s earnings report is important to its market because it reflects growing strength in the hottest market since the DotCom bubble. The company's earnings confirm that capital expenditure plans, data center buildout, and AI infrastructure growth are real. The company reported $291 million in net revenue, a drop in a bucket compared to NVIDIA’s NASDAQ: NVDA quarterly haul, but this is a nuts-and-bolts play, not the primary hardware. The important details include revenue growth approaching 16% year over year (YOY), outpacing the consensus by more than 250 basis points (bps), and a continued acceleration forecast for the current quarter.
Margin news was also bullish. GAAP results were mixed, including non-cash impairments and share-based compensation, but the adjusted results were more clearly positive. They revealed wider margins and record-setting results, with adjusted earnings per share (EPS) up 34% YOY and more than 1000 bps above target.
Guidance is why new highs are likely for this stock. The company expects revenue to grow by more than 12% sequentially and 27% YOY in the next quarter and is likely cautious in its estimate. The likely outcome is that Semtech outperforms and provides another bullish guide, keeping the analysts in revision mode.
The analyst response to Semtech’s results and guidance was mixed: two ratings were reduced to Market Perform or equivalent, but this was offset by more price target increases. Those increases highlight Semtech’s business shift, as they increased the consensus estimate by more than 75% almost overnight. The consensus forecasts a fresh high as of late May; the high end of the range would be sufficient to add 30% to that high.
Institutions Cap Semtech Gains in Q2 2026Institutions are a risk for investors to note. They own a substantial 99.45% of the stock and have been selling into the rally. If this continues, SMTC shares will struggle to advance unless a sufficiently strong catalyst emerges. In this scenario, retail traders and FOMO may take control, ultimately resulting in volatility and potentially lower stock prices. The more likely scenario, however, is that the institutional headwind diminishes now that the Q1 results are in.
The question is whether the institutions revert to accumulating SMTC, and that may not come without a stock price correction. SMTC shares advanced more than 100% in April and May, extending well above any level that could be called strong support. The worst-case scenario is that this stock pulls back, potentially to $138 or lower, while the best-case is that SMTC consolidates at or near the late-May highs until later in the year when more news is available.
SMTC Stock: Correction Ahead, But the Trend Is Your FriendThe chart price action is very bullish, but also shows a high likelihood of a correction before new highs are set. The key factor is the MACD convergence, which says new highs are likely despite the correction; it’s only a matter of time. Among the risks for traders is the depth and timing of the rebound, which may not come until late summer. Other risks include valuation, which reflects a robust growth trajectory. Any signs of weakness, slowing, hiccups, or delays will be reflected in the stock price.
Catalysts include demand for next-gen products, including optical, sensing, and power handling technology, and capacity expansions. Execs say demand is outstripping supply and plan to double or triple existing production. Plans include expanding existing production facilities, outsourcing manufacturing and pursuing strategic partnerships alongside nearshoring or onshoring capacity. Shipments of next-gen products are already underway and expected to ramp over the coming quarters.
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