Sanmina (SANM) Down 4.6% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Sanmina (SANM). Shares have lost about 4.6% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Sanmina due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Sanmina Corporation before we dive into how investors and analysts have reacted as of late.Sanmina Q3 Earnings Surpass Estimates, Revenues Rise Y/YSanmina reported strong third-quarter fiscal 2025 results, with both the top and bottom lines surpassing the Zacks Consensus Estimate.The California-based global electronics manufacturing services provider reported a revenue growth year over year, owing to solid momentum across multiple end markets. Strong growth in free cash flow is a positive.Net IncomeNet income on a GAAP basis in the quarter was $68.6 million or $1.26 per share compared with $51.6 million or 91 cents per share in the prior-year quarter. Top-line expansion supported growth in net income.Non-GAAP net income in the reported quarter was $83.6 million or $1.53 per share compared with $70.8 million or $1.25 in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate of $1.42.RevenuesNet sales during the quarter increased to $2.04 billion from $1.84 billion reported in the year-ago quarter, primarily driven by growth across multiple end markets. The top line beat the consensus estimate by $67 million.In the fiscal third quarter, Integrated Manufacturing Solutions generated $1.64 billion in revenues, up 11.6% year over year. The segment contributed 80.7% to revenues. Solid sales growth was primarily driven by the communications networks and cloud infrastructure end markets.Components, Products and Services revenues increased to $422 million from up 8.8% year over year, backed by growth in several end markets.End-market-wise, Industrial & Energy, Medical, Defense & Aerospace, and Automotive markets generated $1.256 billion in revenues, up 6.2% year over year. The company generated $786 million from Communications Networks and Cloud Infrastructure, up 19.2% year over year.Other DetailsNon-GAAP gross profit was $186 million compared with $157 million in the year-ago quarter. The improvement is driven by a favorable mix and improved operational efficiency. Non-GAAP operating income totaled $115.7 million compared with $96.8 million in the year-ago period. Non-GAAP operating margin was 5.7%, marginally up from 5.3% in the prior-year quarter.Cash Flow & LiquidityIn the third quarter of fiscal 2025, Sanmina generated $200.8 million of net cash from operating activities compared with $90 million in the previous year’s quarter. As of June 28, 2025, the company had $797.9 million in cash and cash equivalents and $287.2 million in long-term debt. During the quarter, the company repurchased approximately 0.2 million shares for approximately $13 million.OutlookFor the fourth quarter of fiscal 2025, revenues are expected to be in the range of $2-$2.1 billion. GAAP earnings per share are forecasted to be between $1.21 and $1.31. Management estimates non-GAAP earnings per share in the band of $1.52-$1.62.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates revision.The consensus estimate has shifted -6.47% due to these changes.VGM ScoresAt this time, Sanmina has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a score of A on the value side, putting it in the top 20% for value investors.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Interestingly, Sanmina has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. Little-known AI firms tackling the world's biggest problems may be more lucrative in the coming months and years.See "2nd Wave" AI stocks now >>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 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