Stifel has raised its price target for Cirrus Logic Inc. to $163.00 from $150.00 while maintaining a Buy recommendation, citing the company's solid fiscal third-quarter performance. The newly stated target matches the highest analyst projection for the stock. Cirrus Logic currently trades at a price-to-earnings ratio of 17.7 and is judged to be undervalued by InvestingPro Fair Value estimates.
For the quarter ended December, Cirrus Logic reported revenue of $580.6 million, a 3.5% sequential increase. That top-line result exceeded Stifel's $530.0 million estimate by 9.6% and outpaced the consensus revenue outlook cited later in the quarter. The company attributed the stronger revenue to higher smartphone unit volumes, although this was partly offset by softening sales in the general market.
Profitability metrics remain robust. Cirrus Logic sustained a 53% gross profit margin on a trailing twelve-month basis, underscoring the company's ability to preserve margin even as volumes shift. Management pointed to continued strength in unit volumes and a favorable product mix as key drivers behind the quarter's outperformance and for the guidance provided for the next period.
Looking ahead to the fiscal fourth quarter ending in March, Cirrus Logic supplied a revenue midpoint of $440.0 million. While that midpoint represents a 24.2% sequential decline from the December quarter, it is materially higher than Stifel's prior projection of $371.0 million - an 18.6% increase over Stifel's earlier estimate. Management cited ongoing unit-volume strength and product mix improvements as the basis for the more upbeat outlook.
Corporate actions and balance-sheet positioning were also highlighted. Company data shows management has been actively repurchasing shares. On the balance sheet, Cirrus Logic holds a cash position that exceeds its debt. Together with Stifel's new target, the firm's implied valuation equates to a 15.0x price-to-earnings multiple on calendar-year 2026 estimates, excluding cash. That multiple corresponds to an implied free cash flow yield of approximately 9% in Stifel's view.
Independent metrics referenced in the analysis rate Cirrus Logic's financial health highly. InvestingPro assigns the company a financial health score of "GREAT" and offers a comprehensive Pro Research Report on the equity among more than 1,400 U.S. stocks.
The quarter's reported earnings and market reaction added context to the analyst action. Cirrus Logic posted adjusted earnings per share of $2.97 for the fiscal third quarter, significantly above the consensus of $2.41 and representing a 23.24% surprise to expectations. Revenue of $580.6 million topped the forecasted $534.52 million by 8.62%.
Despite the stronger-than-expected results, the stock fell in after-hours trading following the announcement. The shares had closed the regular session at $130.53.
These results reflect a quarter in which Cirrus Logic outperformed estimates on both revenue and earnings, while signaling management confidence in near-term demand driven by unit volumes and product mix shifts. Stifel's higher price target and maintained Buy rating crystallize an analyst view that the stock's valuation - when measured against the firm's 2026 earnings estimates and excluding cash - remains attractive.