Dan Loeb‘s Third Point acquired an investment in Flex Ltd. (NASDAQ:FLEX) in the second quarter, buying 1.0 million shares, valued at about $166 million, as of June 30.
Recent News:
- On Monday, Flex agreed to sell $2.0 billion of Series A Convertible Preferred Stock in Axiom Solutions International, its Cloud and Power Infrastructure business, to investment funds affiliated with General Catalyst, Koch Equity Development and co-investors.
- Last month, Flex unveiled Axiom Solutions International as the name of its planned independent cloud and power infrastructure company. The move advances Flex’s plan to separate the fast-growing business into a standalone public company.
- Also, the company agreed to acquire EPC Power for $4.4 billion, subject to customary adjustments.
- Flex reported first quarter adjusted EPS of $1.00, above the 91 cents estimate, while sales of $7.928 billion topped the $7.557 billion consensus.
- For second quarter, the company expects adjusted EPS of $1.00-$1.07 versus the 99 cents estimate and sales of $7.950 billion-$8.250 billion compared with the $7.835 billion estimate.
- Flex raised its fiscal 2027 adjusted EPS outlook to $4.42-$4.74 from $4.21-$4.51, compared with the $4.45 estimate.Fiscal 2027 sales guidance was also increased to $33.700 billion-$35.200 billion from $32.300 billion-$33.800 billion, versus the $33.370 billion estimate.
Technology Sector Check: XLK Lagging as FLEX Outperforms
Flex Ltd. Ordinary Shares sits in the Technology sector, tracked by the Technology Select Sector SPDR Fund (NYSE:XLK), which ranks 10th out of 11 S&P sectors on Monday.
Key Performance Indicators:
- Sector Rank: 10 of 11 sectors (Lagging)
- Daily Move: +0.43%
- 1-Month Trend: +6.81% (Outperforming)
- 90-Day Trend: +11.99% (Bullish)
- Stock vs Sector: Outperforming by 0.44 percentage points
- Top Performing Sectors Monday: Materials (XLB), Energy (XLE), Communication Services (XLC) (These are the top 3 performing sectors today, not peers of Flex Ltd. Ordinary Shares)
Sector leadership on Monday is concentrated in cyclical areas like Materials and Energy, while defensives are mixed and Real Estate is the weakest pocket of the market. Technology is participating but lagging most sectors on the session, suggesting rotation favoring commodity- and growth-sensitive groups over rate-sensitive segments.
Flex (FLEX) Earnings Outlook: EPS and Revenue Estimates
- EPS Estimate: 99 cents (Up from 79 cents YoY)
- Revenue Estimate: $7.83 Billion (Up from $6.80 Billion YoY)
- Valuation: P/E of 45.0x (Indicates premium valuation relative to peers)
Analyst Consensus & Recent Actions: The stock carries a Buy rating with an average price forecast of $134.50 (high: $180.00; low: $84.00) across 11 analysts. Recent analyst moves include:
Recent analyst moves include:
- Freedom Capital Markets: Buy (Maintains Target to $150.00) (Sept. 28)
- Freedom Capital Markets: Buy (Maintains Target to $150.00) (Sept. 8)
- Goldman Sachs: Buy (Lowers Target to $154.00) (July 30)
How Flex Stacks Up vs CLS, JBL, TEL, FN, TTMI
This peer comparison is based on a curated set of five stocks selected for this analysis: Celestica, Inc. (CLS), Jabil Inc. (JBL), TE Connectivity plc (TEL), Fabrinet (FN), and TTM Technologies Inc (TTMI). Over the past year, Flex Ltd. Ordinary Shares gained 105.96%, beating the peer-group average return of 52.74% by 53.22 percentage points. However, it beat the peer-group average but trailed TTM Technologies Inc (TTMI), which rose 127.40%.
Within the group, TTM Technologies Inc was the strongest performer at +127.40%, while TE Connectivity plc was the weakest at -1.13%. The remaining peers were mixed, with Fabrinet up 23.29%, Jabil Inc. up 50.84%, and Celestica, Inc. up 63.32%.
Top ETF Exposure: AVMV, LCLG, and TAX Ownership of FLEX
- Avantis US Mid Cap Value ETF (NYSE:AVMV): 1.22% Weight
- Logan Capital Large Cap Growth ETF (NYSE:LCLG): 4.17% Weight
- Cambria Tax Aware ETF (NASDAQ:TAX): 1.66% Weight
Significance: Because FLEX carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
FLEX Stock Price Activity: Flex shares are trading higher by 0.68% at $117.40 at the time of publication on Monday, according to Benzinga Pro data.
Photo via Shutterstock
Recent Comments