Plexus Gains 15% in 6 Months: Will the Stock Climb Higher in 2026?

Plexus Corporation’s (PLXS) share performance has not been exactly impressive, with gains of 14.5% in the past six months. In comparison, the Electronic Manufacturing Industry has grown 47.5%, whereas the S&P 500 composite and the broader Computer Technology Sector have returned 16.2% and 22.1%, respectively.Price Performance Image Source: Zacks Investment Research Some of the other players in the electronics manufacturing services space, like Jabil (JBL), Sanmina Corporation (SANM) and Flex Ltd. (FLEX) have gained 9.5%, 61.9% and 30.1%, respectively.This performance raises a fair question for investors: whether the stock is poised for a meaningful rebound in 2026, or much of the good news is already priced in.Let us dive into PLXS’ pros and cons, and determine the best course of action for your portfolio.Tailwinds for PLXSPlexus is likely to benefit from new program ramps. The company is focusing its efforts on sectors with robust demand, such as healthcare and life sciences, aerospace and defense, and industrial markets, especially semicap and energy management subsectors. In the fiscal fourth quarter, Plexus announced 28 manufacturing program wins, which are estimated to contribute $274 million to annualized revenues once fully ramped into production. For fiscal 2025, Plexus had 141 manufacturing wins totaling $941 million of annualized revenues.Notably, the industrial sector delivered $165 million in the fiscal fourth-quarter wins, and Aerospace and Defense had $54 million. The funnel of qualified manufacturing opportunities is pegged at $3.7 billion, indicating a strong pipeline for growth. The company had a record funnel for its Aerospace and Defense end market segment. Plexus expects new program ramps, inclusive of market share gains across all three segments, to position it for achieving revenue growth toward the 9-12% target for fiscal 2026. It also expects to sustain or even surpass a 6% non-GAAP operating margin as the year progresses.In fiscal 2025, within the Aerospace sector, defense and space subsectors grew at double-digit rates, and management expects mid-single-digit growth in the fiscal first quarter, supported by the unmanned aircraft subsector and renewed commercial aerospace demand.Plexus Corp. Price, Consensus and EPS Surprise  Plexus Corp. price-consensus-eps-surprise-chart | Plexus Corp. QuoteHealthcare and life sciences continued to show steady improvement, with revenues up 5% for the fiscal year and expected to accelerate to high-single or low-double-digit growth for fiscal first quarter as programs ramps and monitoring and imaging subsectors strengthen.Strong free cash flow generation bodes well. Plexus is driving free cash flow generation through a combination of operational/capex discipline and inventory reduction. The company generated $97 million in free cash flow in the fiscal fourth quarter, taking the full-year free cash flow to $154 million, which significantly exceeded expectations. This brings the 2-year cumulative free cash flow to $495 million.Management expects to generate $100 million in free cash flow for fiscal 2026. Strong cash flow generation positions Plexus to maximize shareholder value via buybacks and reduce debt. It repaid $100 million of debt in the fiscal year. The company repurchased $21.5 million worth of shares at an average price of $134.07 per share under its repurchase program. For fiscal 2025, it repurchases $65 million worth of shares. Of the $100-million authorization, $85 million remains available. The robust cash generation ensures that Plexus has a healthy financial foundation to support growth and investment in the business.PLXS’ HeadwindsManagement noted that revenue growth for fiscal 2026 assumes a modest improvement in end-market demand. The challenges in the Industrial sector in the near term remain concerning. Weaknesses in industrial equipment and vehicle electrification subsectors affected the fiscal fourth-quarter performance. In contrast, energy subsector seasonality and muted demand are expected to cause a high single-digit sequential revenue decrease in the fiscal first quarter for the Industrial segment.Plexus still depends on a few large customers for a significant part of its revenues. The top 10 customers accounted for 49% of the company’s revenues in the fourth quarter of fiscal 2025, down from 52% in the fourth quarter of fiscal 2024. For fiscal 2025, the top 10 customers comprised 49% of revenues, up from 48% in fiscal 2024. Despite the improvement, the top 10 customers still comprise a large chunk of revenues. This exposes the company to customer concentration risks.Macro uncertainty due to shifting trade policy remains an additional concern. Tough competition in the electronics manufacturing space from the likes of Jabil, Sanmina and Flex. Image Source: Zacks Investment Research Given all these factors, analysts have marginally revised PLXS’s estimates down for the current quarter and year.PLXS ValuationIn terms of the forward 12-month price/sales ratio, PLXS is trading at 0.93, a bit higher than the sector’s multiple of 0.89. Image Source: Zacks Investment Research In comparison, FLEX trades at a forward 12-month P/S multiple of 0.84, whereas Jabil and Sanmina are trading at a multiple of 0.76 and 0.58, respectively.How to Play the PLXS Stock?Though PLXS has a healthy long-term outlook, the expectation for the near term remains somewhat muddled. New investors need to wait for a better entry point, while existing investors can retain the stock.It currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Naming Top 10 Stocks for 2026Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%.Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Plexus Corp. (PLXS): Free Stock Analysis Report Jabil, Inc. (JBL): Free Stock Analysis Report Flex Ltd. (FLEX): Free Stock Analysis Report Sanmina Corporation (SANM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks