Sanmina Reports Strong Earnings but Stock Drops on Weak Guidance
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3d ago
0mins
Should l Buy SANM?
Source: Fool
Sanmina Corp's stock fell 8.14% after hitting a 20-day low, reflecting investor concerns despite the company reporting strong earnings.
The company announced Q1 FY2026 net sales of nearly $3.19 billion and a non-GAAP net income of $132 million, exceeding analyst expectations. However, the stock plummeted due to weak guidance for Q2, projecting sales between $3.1 billion and $3.4 billion, which fell short of analysts' expectations of $3.51 billion. This disconnect between strong earnings and cautious outlook led to a significant market reaction.
The implications of this earnings report suggest that while Sanmina is performing well in terms of revenue growth, investor sentiment is heavily influenced by future sales expectations, indicating a need for the company to address market concerns to regain investor confidence.
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Analyst Views on SANM
Wall Street analysts forecast SANM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for SANM is 180.00 USD with a low forecast of 180.00 USD and a high forecast of 180.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
1 Analyst Rating
0 Buy
1 Hold
0 Sell
Hold
Current: 142.340
Low
180.00
Averages
180.00
High
180.00
Current: 142.340
Low
180.00
Averages
180.00
High
180.00
About SANM
Sanmina Corporation is a global provider of integrated manufacturing solutions, components, products and repair, logistics and after-market services. It provides end-to-end manufacturing solutions, delivering support to original equipment manufacturers in the industrial, medical, defense and aerospace, automotive, communications networks and cloud infrastructure markets. Its operations are managed in two businesses: Integrated Manufacturing Solutions (IMS) and Components, Products and Services (CPS). IMS segment consists of printed circuit board assembly and test, high-level assembly and test and direct-order-fulfillment. CPS includes advanced printed circuit boards, backplanes and backplane assemblies, cable assemblies, fabricated metal parts, precision machined parts and plastic injected molded parts. Its products include optical, radio frequency and microelectronic design and manufacturing services, multi-chip package memory solutions, high-performance storage platforms and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Economic Data Impact: The ADP report indicates that US private payrolls rose by an average of 7,750 per week in the four weeks ending January 3, the smallest increase in six weeks, which may affect investor confidence in economic recovery.
- Upcoming Economic Indicators: The market is focused on consumer confidence and initial unemployment claims data this week, with the consumer confidence index expected to rise to 91.0, potentially providing support for the market and reflecting consumer optimism about the economic outlook.
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