Cirrus Logic, Inc. (CRUS): what the price requires
At today's price, Cirrus Logic, Inc. (CRUS) is priced for +7.7% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/CRUS
Headline
| Field | Value |
|---|---|
| Ticker | CRUS |
| Company | Cirrus Logic, Inc. |
| Current price | $146.57/sh |
| Composition | Audio Products 58% / HPMS Products 42% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 16.4% |
| Operating margin today | 24.5% |
| Margin compression implied | -8.1pp |
| Implied growth | 7.7% |
| Multiple paid | 13x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 10.4% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~4.9pp.
Reconcile: at the x-ray's 9.3% required return this reads ~2.2%/yr; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -0.44σ |
| cohort percentile (of 177 peers) | 15 |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by earnings-power and relative-multiple and growth-DCF value, while asset-based lands below the price. A value/asset-supported name, not a pure growth bet.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 1.72x | 5 | expensive |
| Earnings | 1.16x | 5 | expensive |
| Relative | 0.77x | 5 | justifies |
| Growth | 0.82x | 3 | justifies |
Families that justify the price: Earnings, Relative, Growth Families that call it expensive: Asset
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.1%); the inversion above states its own rate.
Per-Model Detail (n=18)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $272.77 | 0.54x | yes | FCF base $0.7B, growth 6% (input: historical growth), terminal g 4.0%, WACC 9.1%, 6yr projection |
| DCF Exit Multiple | Growth | $178.60 | 0.82x | yes | Exit EV/EBITDA: 12.9x / 14.9x / 16.9x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $169.63 | 0.86x | yes | P/E 22x (static sector reference · 2026-04), scenarios: 18.4x / 22.0x / 25.6x (bear / base = reference held flat / bull), EV/EBITDA 16x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $85.01 | 1.72x | yes | BV/sh $40.38, ROE (TTM) 19.5%, ke 9.3% |
| Two-Stage Excess Return | Asset | $121.99 | 1.20x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $114.06 | 1.29x | yes | Rev $2.0B, growth 6% (input: historical growth; tapered), Terminal P/S: 3.2x / 3.9x / 4.5x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $259.75 | 0.56x | yes | EPS $7.85, growth 33% (input: historical EPS growth), PEG=0.56 (Undervalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $74.49 | 1.97x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.36B × (1−18%) / WACC 9.1% → EPV (no growth) |
| Residual Income | Asset | $118.88 | 1.23x | yes | BV $40.38 + 5yr PV of (ROE (TTM) 19.5% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $84.45 | 1.74x | yes | √(22.5 × EPS $7.85 × BVPS $40.38) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $156.43 | 0.94x | yes | EBITDA $0.47B × sector EV/EBITDA 16.0x |
| FCF Yield | Earnings | $143.25 | 1.02x | yes | FCF $636.6M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $126.47 | 1.16x | yes | SBC-adj FCF $0.55B (FCF $0.64B − SBC $0.08B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $253.29 | 0.58x | yes | EPS $7.85 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $22.39 | 6.55x | yes | BV $40.38 × (ROIC 5.0% / WACC 9.1%) |
| P/Sales Sector | Relative | $189.51 | 0.77x | yes | Revenue $2.00B × sector P/S 5.0x |
| PEG Fair Value | Relative | $294.37 | 0.50x | yes | EPS $7.85 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $84.86 | 1.73x | yes | EPS $7.85 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net cash | $887.6m |
| Net debt / NOPAT (after-tax) | -2.11x (net cash) |
| Net debt / operating income (pre-tax) | -1.72x (net cash) |
| Interest coverage | 575.1x |
| Share count CAGR (buyback) | -2.8% |
| Burning cash | no |
Bullet Takeaways
- Cirrus Logic designs the audio and mixed-signal chips inside the iPhone, a business that earns a 23% operating margin and around $637 million of free cash flow with no debt and roughly $890 million of net cash.
- The defining risk is one number: approximately 91% of fiscal 2026 revenue came from a single customer, so the company's fortunes track Apple's iPhone cycle almost one to one.
- What to watch is content growth and diversification: Apple named Cirrus Logic a key partner in its American Manufacturing Program, and the company is pushing its high-performance mixed-signal line into automotive, industrial and other markets to reduce its dependence on one buyer.
Bull Case
Cirrus Logic is a mature, highly profitable chip designer, and the right way to read its numbers is as a quality compounder living inside one enormous customer relationship. The company earns a 23% operating margin, generates around $637 million of free cash flow, and carries no debt against roughly $890 million of net cash. Those are the financials of a business with genuine technical edge, not a commodity supplier. Cirrus describes itself as serving customers who "obtain value from our expertise in advanced analog and mixed-signal design processing, systems-level integrated circuit engineering and embedded software development," and that expertise is why it has held its position designing the audio and power chips at the heart of the iPhone for years.
The growth lever is content per device, and it is moving in Cirrus's favor. Even when iPhone unit volumes are flat, the company can grow by putting more of its chips into each phone, and Apple naming Cirrus Logic a key partner in its American Manufacturing Program is a signal that the relationship is deepening rather than fraying. Fiscal 2026 was a record year, with revenue at $2.0 billion and GAAP earnings of $7.85 per share, and the fiscal first-quarter 2027 revenue guidance of $430 million to $490 million came in above consensus. A supplier that keeps winning more content in the world's most demanding consumer device is doing the hardest thing in semiconductors well.
The diversification effort is the longer-term upside the price does not fully credit. The high-performance mixed-signal product line is now 43% of revenue, and the company is pushing it into professional audio, automotive, industrial and imaging markets to broaden beyond the smartphone. Management is also returning capital, repurchasing stock and shrinking the share count nearly 3% a year. The balance sheet, with $1.2 billion of cash and no debt at year-end, funds both the diversification and the buyback comfortably. The bull case is a cash-rich, debt-free designer with rising content in its anchor customer, a real effort to broaden its base, and a valuation the relative-multiple and growth methods support.
Bear Case
The variable with by far the most leverage on Cirrus Logic is the one it cannot control: Apple. Approximately 91% of fiscal 2026 revenue came from a single customer, which means the company's results are essentially a derivative of the iPhone cycle. The company states the risk plainly, warning that "the loss of any of our key customers, or a significant reduction in sales or selling prices to any key custome[r]" would hit its sales and profitability. That is not a hypothetical hedge; it is the structure of the business. A weak iPhone cycle, a shift in Apple's component strategy, or a decision to bring audio or power management in-house, the way Apple has done with modems and other parts, would damage Cirrus in a way no diversification effort can fully offset in the near term.
The macro and product-cycle sensitivity flows from that concentration. Smartphone demand is cyclical and increasingly mature, and the AI-phone upgrade cycle that bulls hope reaccelerates units is not guaranteed to arrive on schedule. The price assumes operating profit grows roughly 13% a year for five years, a pace only about half of comparable fast-growers sustained for that long, and for a company this dependent on one customer's product roadmap, that durability is harder to underwrite than for a diversified chipmaker. The American Manufacturing Program is a double-edged development: it adds content and deepens the relationship, but it also ties Cirrus more tightly to Apple at the very moment the bull case wants it diversifying away.
The valuation is reasonable rather than cheap, which limits the margin for error. The relative-multiple and growth methods support the price, but the asset-value methods say it is expensive, and the earnings-power methods, which capitalize current cash generation, land below the price too. State the requirement plainly: the price needs Cirrus to keep growing content and hold its Apple position for years, and if iPhone units soften or Apple's sourcing shifts, operating profit grows slower than the implied 13%, and the multiple compresses toward where the asset and earnings-power methods land. The balance sheet is pristine, net cash and no debt remove any solvency concern, so this is not a distress story. It is a quality single-customer supplier priced for continued content gains, where the entire thesis rests on a relationship the company does not own.
Valuation
The price reflects a reasonable, not aggressive, bet. Read backward, today's level pays about 15 times company-wide operating income, implying operating-profit growth of roughly 13.4% a year for five years. Keep that approximate; it is one solve. The implied pace is within what Cirrus has recently delivered, and only about half of comparable fast-growers sustained it for five years, so the bet is squarely on the company maintaining its content gains in the iPhone rather than on a heroic acceleration.
The methods we use to triangulate split along the quality-versus-price line. The relative-multiple comparison against the semiconductor sector lands essentially at the price, calling it fairly valued. The growth methods land near it. But the asset-value methods, anchored on book value plus profitability, land below the price, because the return on equity is good but does not by itself justify the multiple, and the earnings-power methods land below it as well. The spread is the modest premium the market pays for a profitable, debt-free designer with a durable technical position, balanced against the concentration that caps how much of a premium it will bear. There is no extreme dislocation here; the methods broadly bracket the price.
Solvency is the cleanest part of the story and a real asset to the thesis. Cirrus holds roughly $890 million of net cash with no debt, generates around $637 million of free cash flow, and has been retiring shares. That balance sheet means the company can fund its diversification into new markets and keep returning capital without any financial strain, and it removes distress entirely from the downside. What the valuation rests on is not solvency but durability: whether the Apple relationship keeps delivering rising content, and whether the high-performance mixed-signal push broadens the base enough to make the 91% concentration less of a single point of failure over time.
Catalysts
The defining catalyst is content growth within Apple. Apple named Cirrus Logic a key partner in its American Manufacturing Program, which deepens the relationship and, analysts estimate, could add meaningful new dollar content per iPhone. The pace of those content wins, more than iPhone unit volumes, is the swing factor for revenue, and each earnings print is a read on whether Cirrus is gaining or holding share of the bill of materials in its anchor customer's flagship product.
The near-term catalyst is the fiscal 2027 guidance trajectory. Cirrus guided fiscal first-quarter 2027 revenue to $430 million to $490 million, above consensus, after a record $2.0 billion fiscal 2026. Whether the upcoming iPhone cycle supports that guidance, and whether an AI-driven upgrade wave lifts units, is the cyclical question underneath the content story. Analysts have raised targets into the print, with a Buy consensus and recent targets ranging from the $140s to roughly $200.
The longer-term catalyst is diversification. The high-performance mixed-signal line is now 43% of revenue, and the company's push into automotive, industrial, professional audio and imaging is the path to reducing its Apple dependence. Evidence that those non-Apple markets are scaling would be the clearest sign the concentration risk is easing, and it is the development most likely to earn the stock a higher multiple over time. The next earnings print is the test of whether content gains and the new-market push are tracking, against a backdrop where one customer still drives the great majority of revenue.
Peer Cohorts (Per Segment, With Filing Citations)
Cirrus Logic (whole company) (reported)
- SWKS (SKYWORKS SOLUTIONS, INC.)
- (no filing in the citation store)
- QRVO (Qorvo, Inc.)
- (no filing in the citation store)
- ALGM (ALLEGRO MICROSYSTEMS, INC.)
- (no filing in the citation store)
- MTSI (MACOM Technology Solutions Holdings, Inc.)
- (no filing in the citation store)
- MCHP (MICROCHIP TECHNOLOGY INCORPORATED)
- (no filing in the citation store)
- ON (ON Semiconductor Corporation)
- (no filing in the citation store)
- HIMX (Himax Technologies, Inc.)
- (no filing in the citation store)
- DIOD (DIODES INC /DEL/)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
Cirrus Logic FY2026 results · CRUS solvency, latest filings · CRUS FY2025 10-K, accession 0000772406-25-000014 · analyst notes, 2026