Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.
The meteoric rise of technology stocks like Nvidia has made many investors incredibly wealthy. They’re examples of companies whose values have soared because they make AI-enabled products, but in case you missed them, this sector is full of other potential big winners. One of these is Penguin Solutions, which has had a disappointing third quarter of 2024. Why are so many analysts optimistic about it?
Don’t miss:
One of the most pressing questions facing the technology industry is how to expand and maximize the capabilities of AI. That’s why data center REITs and utility companies are so popular. AI consumes data and power at geometric rates. However, it also depends on memory and storage. Penguin Solutions (Nasdaq: PENG) offers a full range of products and services to help data centers and technology companies meet the intense memory demands of AI.
A partial list of Penguin’s products includes solid-state servers, LED applications, and custom data center solutions. Penguin was originally founded in 1988 as SMART Global Holdings. In the 36 years since its founding, Penguin has grown into a trusted service provider for multiple industries, including:
· Telecommunications
· Healthcare
· Energy sector
· Government and education
Trending: During market downturns, investors learn that, unlike stocks, this is the case High-yield real estate bonds paying 7.5% to 9% are protected by resilient assets, which buffer against losses.
Despite that strong customer base, Penguin shares are down about 10% this year and the company just released a weaker fourth-quarter 2024 earnings report. The company’s earnings per share (EPS) of $0.37 surpassed Q3 2023’s $0.35, but fell short of the $0.40 analysts had forecast. Net sales of $1.2 billion were also down from $1.4 billion in 2023. This led to a sell-off in late October and Penguin is now trading at $17.29.
That’s a relatively low buy-in for a more than thirty-year-old company that provides AI and technology solutions to customers in multiple industries. Analysts at Goldman agree and recently gave Penguin a buy rating. Goldman believes that Penguin’s range of products and services, combined with its low share price, amounts to an undervalued stock. Their forecast for Penguin stock is $21, but Stifel analysts think Penguin stock could reach $27.
See also: Wondering if your investments could earn you a $5,000,000 nest egg? Talk to a financial advisor today. SmartAsset’s free tool matches you with up to three vetted financial advisors serving your region, and you can interview your advisors for free to decide which one is right for you.
There also appears to be a consensus between Penguin management and its analysts on a revenue recovery by 2025. Penguin management predicts revenue will increase by 15% and analysts expect revenue to reach $1.4 billion 2023 will match. If Penguin meets these targets, its stock price will rise. is prepared for a strong increase. If shares reach the midpoint between the $21 and $27 range that analysts are predicting, Penguin investors will have a happy 2025.
That would result in Penguin shares trading around $24, a gain of almost 35% from the current share price of $17.29. It’s important to remember that there is no guarantee that Penguin will achieve the targets set by analysts. However, it is also possible that Penguin will exceed these expectations and become a big winner in 2025. So if you’re looking for an affordable tech stock and have been missing Nvidia, check out Penguin.
Real estate is a great way to diversify your portfolio and earn high returns, but it can also be a big hassle. Fortunately, there are other ways to tap into the power of real estate without owning real estate. Arrivald Home’s Private Credit Fund has historically paid an annualized dividend yield of 8.1%*which provides access to a pool of short-term loans backed by residential real estate. The best part? Unlike other private credit funds, this one has a minimum investment of just $100.
Looking for fractional real estate investment opportunities? The Benzinga Real Estate Screener has the latest offering.
This article These undervalued AI stocks are trading as low as $20 – could this be the next Nvidia? originally appeared on Benzinga.com
