I Like This Growth Stock A Lot here
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Today I share with the Financial Education nation a growth stock that I like a lot even here. If this stock was to go down more I would really really like it. This has historically been 1 of the best stock market investments I have ever made several times.. 2014/2016 and 2018/2019. The stock has dropped a decent amount recently and now this stock is looking real good for me.
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Hello ladies and gentlemen to June today’s feature presentation, I’m going to go ahead and share with you guys a growth stock that I like a whole lot right here. But most importantly, I’m going to share with you some insights I have on this particular stock, why I actually liked I think that’s way more valuable than actually just sharing what the stock is.
Because at the end of the day, if you don’t know the insights, you don’t really know why I’m so bullish on the stock. Also, you don’t like learn the thought process that goes through my head when it comes to buying some of these stocks.
I love this stock. I made money on it in the past making money on it currently I’ve made money a lot of times on the stock, let’s just put it that way. And it’s a beautiful, beautiful stock and it’s reached some very interesting levels.
Okay, also speaking about levels I’m gonna tell you some levels that I will buy heavy into this stock a heavy, heavy, heavy, okay, so a growth stock This is a growth stock we’re talking about here today.
And if you don’t, you know, there’s lots of different definitions that people think for like a growth stock they think does that mean like the stock price is going up does that mean like the bottom line is going up the top line if you’re talking about a growth stock.
Here’s how I think about it 10% plus revenue growth years to go in the future Okay, so they’re expected to grow next year 10% plus and the year after and things like that, that’s what I’m looking for.
That’s what I consider a true growth stock a stock that’s going to grow 10% plus on their top line in future years, and hopefully more than 10% on their bottom lines. Okay, now before I get into all the bullish thesis around the stock, why really like at this price, some insights around the stock that I know are going on right now and will continue to go on.
I got to share the risk, okay, is a very volatile stock I’ve seen the stock, I mean, I’ve seen the stock everywhere basically in the past I’ve seen it I think I’ve seen it under $20 if I recall in the past, okay, and I’ve also seen the stock well over $80 in the past is a very very volatile stock just looking at a stock chart over the last you know.
510 years extremely volatile stock pay, the other risk is they have a heavy customer concentration, meaning one of their customers or two of their customers make up a significant significant portion of the money coming in through the door and so those are the two main risks I like to always you know.
Try to talk about the rest with some of these shocks and for this particular company, those are the two main risks super volatile stock which I don’t really look at that as a risk I just look at that as more of an opportunity but heavy customer concentration that is a main risk for this one so hope you guys enjoyed today’s video as always.
Make sure you smash the thumbs up button for the algorithms and also leave me a comment down there on if there are any growth stocks that you guys like here today. And I know we’ve talked about a wall if the market drops a bunch you know we like this stock that stock but today.
I’m talking about today are there any growth stocks out there that you guys like today comment down there Okay, so once again smash thumbs up let’s get in this guy’s this stock here today is making a 3% that we’re moving at $60 a share cruzi doozy some of you guys may know this one, it’s a little more of the underground type company.
Cruisey doozy Cirrus Logic, this one has started to reach levels that are really interesting to me and I have some insights on the stock that I really want to share. Okay, so there are some interesting things that are going on with cruzi doozy that I think Wall Street is really missing right now Wall Street is is selling the stock right now and I think they’re missing something.
Okay. And then we’ll get into levels I’m gonna buy heavy out okay. So when it comes to cruzi doozy This is a stock I still have a somewhat of a position in but it’s a very, very, very small position.
It’s one of the smallest positions. I have an entire stock market right now. I only hold 200 shares of cruzi doozy right now, my cost basis on that is incredibly low $35.48. Okay, now there’s a stock ever gonna see 30 or $35.48?
Again, probably not okay, probably not unless it you know, the relationship with their biggest customer ever broke up outside of that the stocks not going to go back down there. So I can’t, this isn’t one of those stocks I used to have, well, it might go back down there. Now.
It’s just completely unrealistic. Alright, got it in that stock when it was like stealing money essentially. Okay. And back half of 2018, when we had that huge market dip into the early part of 2019. I bought a lot of shares in the stock at that particular time and the shares I still hold that were bought during that time.
And you know, I was able to make a lot of money and I’ve sold a lot of shares when the stock went up to the 70s. And then 280s, I sold a lot of shares off and I took some crazy, crazy profits over time.
This is a stock I started buying all the way back and shoot it was like 2017. So when it comes to cruzi doozy This is a stock sometimes I’ll jump in and out of more often not like every day, not even every month and sometimes not even every year. But this is a stock that is a very volatile stock, it tends to get either really undervalued or really overvalued at a particular time.
And so I looked at those particular times, especially when it went to 85. I was looking and I was like I think a lot of the good news has already been priced in with this one is pricing and a lot of future growth.
And now it’s starting to fall and I’m like no I’m definitely glad I sold those shares in the 70s and 80s. As now I’m looking at it. Like I said it doesn’t work with this with all stocks but with a sock like cruzi doozy, a semiconductor company.
Sometimes you can get Now this one a little more often, I’ve played this one many times over the past probably six, seven years now. And it’s been one of my most successful stocks in terms of, like just taking some crazy profits.
Like this stock has made me, you know, free, like definitely 10s of 1000s of dollars over the past six or seven years, but, you know, potentially 100k Plus has been a great stock. Okay, so what’s going on with this one?
Okay, so cruzi doozy first off for those you guys who might not even know this stock, they’re headquartered out in Austin, Texas semiconductor company, and they make chips, okay, semiconductor chips that go into smartphones, mainly, but also even like tablets.
They also make chips that can go into headphones, different devices like that, even like smart speakers, all those different things. Okay. So think of them as smart codecs, audio amplifiers, haptic incensing solutions, haptic consensus solutions, by the way, are like you ever felt like a vibration from your iPhone or something like that.
They used to be in a motor that were in like, like phones back in the day, like an actual physical motor that’s no longer like that’s an action an amplifier in the phone that’s giving you that haptic feedback to your thumb, like when it vibrates or something like that.
And that, guess what? It’s cruzi doozy doing that? Okay, that’s their chips, Kay, voice processing. This is all stuff they do. And if you look at like a tear down of like a new iPhone, or you know, a lot of these different devices out there, you’re gonna find cruisey doozy chips in there.
You know, basically audio codecs, you’ll find amplifiers, like I said, you’ll usually find an amplifier nowadays for also the tactile feedback. So think of it this way. You go ahead and you’re hearing a voice coming out of your iPhone, right?
Guess who what chips that’s running through that’s running through cruzi doozies chips. Okay? When you play music through your iPhone, guess what? that’s running through cruzi doozy chips. Okay, so anytime you’re able to hear somebody on your phone, or play music thing, cruzi doozy for that, because that’s all running through their chipsets at the end of the day, amazing technology.
And obviously, the biggest customer is Apple. Okay, well, obviously, you know, Apple’s a massive business and they love to use more of the high end type semiconductor companies that do a lot of in house technology and will work closely with you and you know, Cirrus Logic is, you know, the reason this company has grown so significantly, is because of Apple, okay?
Now, they’re also supplier to the top eight, the top eight OEMs when it comes to mobile devices, okay, smart accessories is a supplier of two of the top three truly wireless headset brands. They’re also supplier to the top to smart home.
OEMs. Okay, here’s something terrific, okay, the company expects to expand content with new and existing customers in fiscal year 2021. By the way, they’re already in their fiscal year 2021 their fiscal year, I don’t know if with his weird recruits you do is you always run like a year ahead of time. Okay.
But that is that is extremely important. Okay, that line is extremely important. That is essentially executives at the company saying they have new customers coming new design ones coming with brand new customers.
But not only that, their existing customers, they have new technologies coming in those devices. So they expected to expand content across the board doesn’t matter if it’s we’re talking new customers or existing customers.
That is really, really good news. I think that something is being very overlooked by wall street right now. Okay, here’s something that makes cruisey doozy so special is one of those insights. Competition is focused everywhere.
Okay, so essentially Cirrus Logic is not the only company that makes audio chips. Like I’m sure there’s some Cirrus Logic like audio chips in this device I’m holding right here, this high power, okay.
They’re not the only company in the world that does this. But the problem is their competitors are focused on a lot of different businesses and audio is just one of their businesses. When it comes to cruisey doozy, all they focus on is strictly audio.
So if you’re wondering, why do they have these connections, what makes them so special? Why do they Why is Apple want to do business with Cirrus Logic versus one of these other companies, these other companies they don’t have, you know, 1000 employees 2000 employees dedicated just toward audio teams and making custom solutions.
Cirrus Logic is really the only company in the world that focuses on this stuff solely these other guys, they have a ton of different businesses so which means they can’t focus just on audio. This is why Cirrus Logic has so many relationships with all these huge companies.
And you’re like, Whoa, whoa, whoa, they’re not the only ones that make this that it doesn’t another company makes smart codecs. Cirrus Logic is special, because this is all they focus on. And so if you’re Apple, who do you want to work with at the end of the day, the company that’s focused on the solely is going to give you the best product in the best technology all the time.
Where you want to focus on getting what you need, having one of these other guys be your, your supplier, that aren’t even focused on this mainly, this is this is special stuff, guys. Okay, Cirrus Logic growth vectors, okay, expanding content and share in smartphones.
They want to increase concentration of stereo smartphones with dual loudspeakers. So essentially, all these different smartphone manufacturers out there, they all want to make their smartphones louder and louder and louder so you can play music through it right?
Now a lot of people love to do that. But the issue in the past is a lot of these smartphones have horrible, horrible speakers. And it’s too quiet, it doesn’t sound that good, especially when you turn all the way up.
And so you know, Apple and all these high end, basically smartphone manufacturers are focusing more and more on those those iPhones and those Samsung phones and galaxies and whatever being super loud, sounding super good, as good as like a loudspeaker would sound you know, like, like a jam box or one of those type of devices.
So that’s a massive opportunity for them boosted amplifier penetration increasing across the global smartphone market, increased adoption of seamless, always on activation, basically, meaning you can talk to your device anytime you want.
And then we talked about voice biometrics, that’s a whole other level of growth for Cirrus Logic in the future when we talk about voice biometrics, basically your voice, being able to recognize that it’s you talking, unlock it, read emails, text messages.
Anything, even if you’re not by your phone or something like that, you can say it and then recognize your voice and somebody can’t get in there that essentially is just a random person. That’s special technology.
Okay, increasing demand for truly wireless headsets, expansion of Sam with new applications and technologies, secure user authentication with voice biometrics, that’s what I was just talking about right now.
Okay, haptic drivers for button replacement, and enhanced user experiences. And keep in mind what’s going on with all these devices, they continue to remove buttons and remove buttons. And eventually, there’s gonna be no more buttons on any of these dang devices.
Okay, and if you want to get a feedback, that’s going to happen to the amplifier, which is going to you know, basically kind of give you like some tactile feedback there. Okay, sensing applications and incremental non audio, low power signal processing, expansion opportunities across the board. Here’s kind of some of the dollar amounts they’re getting.
So basically, picture you go buy, you know, a new iPhone today and iPhone 11 at the Apple store, you order one online, okay, Cirrus Logic essentially making is somewhere between three and $4. Likely from that iPhone being sold between their their smart codec in their audio amplifiers and their haptic drivers between all those different things.
Basically, Cirrus Logic just got three or $4 out of that, you know, whatever amount of money you spent on that iPhone $1,000 or whatever. So every time one of those devices sold, they’re making some money off that and the same thing could be said for actually like iPads as well.
They’re usually you know, a big supplier of different components inside the iPads. And they’re even in a lot of the Mac books as well. So across the board, it’s phenomenal, phenomenal opportunity, obviously for Cirrus Logic, okay, they have a track record of long term revenue growth.
If you look at this company, you know, they don’t grow every single year, sometimes they’ll take a step back, but most years they grow Okay. Now if you’re looking at fiscal 18 into fiscal 19, why did they have a huge step down there in revenue?
Well, essentially they had a little thing that was being put in like all the iPhone boxes, so dongle right? This was after Apple kind of moved to like lightning headphones, right? So they included this little dongle in essentially Cirrus Logic made that dongle and so Cirrus Logic got, I think it was like $2 or something.
It was either one or $2 for every single like iPhone that was sold, like extra. Okay, so it was phenomenal while it lasted there. And unfortunately it went away in 19. So that’s why their revenue stepped down.
Then they got back to growth this past year and this current year we’re in it wouldn’t be a strong growth year. If it wasn’t for Roni Rona coming out of nowhere. I mean, unfortunately, it will probably be a negative year for Cirrus Logic as we go to this next slide here, analysts are expecting the company to have revenues declined 7%.
This was supposed to be a growth year and it would be a growth year literally wasn’t for the fact that the whole world bot economy has shut down for several months, essentially. And we’ll see what that number comes in at Wall Street hasn’t been negative 7%.
I wouldn’t be surprised if they actually don’t have their revenue go down that much. I think it’s very possible they could only see revenues decline, one to 3% this year, we’ll see what the numbers end up shaking out.
I think it’s very possible they only see a one to 3% decline, which would be extremely impressive considering the horrible situation. Obviously, the worldwide economy has been in, you know, over the past, let’s say, you know several months Okay, no next year expect to get back to nice growth.
Okay, in the next fiscal year expected to get back to 11.6% growth. I think that number could be low. I think they could grow 15 to 20% next year. I think Wall Street is too low balling those numbers there Honestly, I really do.
I’m expecting 15 to 20% growth next year revenue wise I think it’s going to be a really strong year that basically anybody that push back orders they’re gonna they’re gonna order in the future. Okay, and analysts are expecting the company at $4 of ETS next year, which I think is also a low number but $4 ETS is a very very strong growth.
Look at his company. He consistently kind of will stand back numbers to a to a certain extent Cirrus Logic Jason wrote over there. You know, I know there’s I’ve been following his company for literally like 789 years now.
They love to kind of sandbag numbers and then they love to come in and beat those numbers. You look at the earnings surprises a company that very rarely misses numbers. Like I said, I’ve been following his company for like seven or eight years now and they consistently beat these numbers in or at least we’ll meet them.
I could tell you out of the quarters I’ve been following this company, the amount of times they’ve ever missed numbers extremely small. And the amount of times they’ve you know, destroyed numbers in a positive way is like, you know, through the roof, it’s ridiculous and you know, look at the last four quarters, every single quarter huge beats, huge beats, huge beats.
Okay, balance sheet wise, phenomenal, no long term debt in this company, about $600 million in cash. $600 million in cash is not a big market cap company to have 600 million cash sitting around. Incredible number. Okay.
They have a buyback program on in q4, they utilize $50 million of that buyback, and they bought back a lot of shares, unfortunately, on average price 7318. But in fiscal year 2020. In general, they used 120 million to repurchase shares, average price of 5632.
So that is lower than the stock price is right now. So as of right now, that looks like it was a smart move. Okay, I still have another 100 and $20 million for share repurchase as of March 28th. I’m hoping they bought some on the dip. And I’m also hoping if the stock goes under 60, which I think it was just under 60.
Day Heck, she hit the 50s I believe to at one point today like in the 50s range, I think they should continue to use that share buyback anytime the stocks anywhere around $60 or under $60 and continue to buy back those shares because they just have so much cash taxes, they are very successful.