Dolby Laboratories (NYSE:DLB) Reaches New 1-Year Low - Should You Sell?

Key Points

• Dolby Laboratories shares hit a new 52-week low on Thursday, falling to $51.91 before last trading around $52.52. The stock remains below both its 50-day and 200-day moving averages.
• Analysts remain cautiously bullish despite the drop, with three Buy ratings and two Hold ratings. The consensus view is a “Moderate Buy,” and the average price target is $90.75.
• Recent earnings topped expectations: Dolby reported Q2 EPS of $1.37 versus the $1.31 estimate and revenue of $395.63 million, up 7% year over year. The company also maintained a quarterly dividend of $0.36, yielding about 2.8% annually.

Dolby Laboratories (NYSE:DLB - Get Free Report)'s share price hit a new 52-week low on Thursday . The company traded as low as $51.91 and last traded at $52.5180, with a volume of 18730 shares changing hands. The stock had previously closed at $52.89.

Wall Street Analysts Forecast Growth

A number of brokerages recently weighed in on DLB. Weiss Ratings reissued a "hold (c-)" rating on shares of Dolby Laboratories in a report on Friday, March 27th. Barrington Research reissued an "outperform" rating and issued a $90.00 price target on shares of Dolby Laboratories in a report on Monday, April 27th. Wall Street Zen raised shares of Dolby Laboratories from a "hold" rating to a "buy" rating in a report on Saturday, May 30th. Finally, Rosenblatt Securities reissued a "buy" rating and issued a $85.00 price target on shares of Dolby Laboratories in a report on Thursday. Three investment analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $90.75.

Dolby Laboratories Price Performance

The stock has a market capitalization of $4.95 billion, a P/E ratio of 20.72 and a beta of 0.81. The business's 50 day simple moving average is $58.69 and its 200-day simple moving average is $62.38.

Dolby Laboratories (NYSE:DLB - Get Free Report) last announced its quarterly earnings data on Thursday, April 30th. The electronics maker reported $1.37 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.31 by $0.06. Dolby Laboratories had a net margin of 17.85% and a return on equity of 11.47%. The firm had revenue of $395.63 million for the quarter, compared to analysts' expectations of $385.80 million. During the same period last year, the firm earned $1.34 earnings per share. The business's revenue for the quarter was up 7.0% on a year-over-year basis. Dolby Laboratories has set its FY 2026 guidance at 4.300-4.450 EPS and its Q3 2026 guidance at 0.560-0.710 EPS. Research analysts anticipate that Dolby Laboratories will post 3.21 earnings per share for the current fiscal year.

Dolby Laboratories Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Wednesday, May 20th. Shareholders of record on Tuesday, May 12th were paid a $0.36 dividend. The ex-dividend date of this dividend was Tuesday, May 12th. This represents a $1.44 dividend on an annualized basis and a yield of 2.8%. Dolby Laboratories's dividend payout ratio (DPR) is presently 56.92%.

Insider Buying and Selling at Dolby Laboratories

In other news, SVP Shriram Revankar sold 3,000 shares of Dolby Laboratories stock in a transaction on Friday, May 15th. The shares were sold at an average price of $54.90, for a total transaction of $164,700.00. Following the transaction, the senior vice president directly owned 80,603 shares of the company's stock, valued at $4,425,104.70. This trade represents a 3.59% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, CMO Todd Pendleton sold 11,876 shares of Dolby Laboratories stock in a transaction on Friday, May 22nd. The stock was sold at an average price of $54.55, for a total transaction of $647,835.80. Following the transaction, the chief marketing officer directly owned 41,480 shares in the company, valued at approximately $2,262,734. This represents a 22.26% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 39,791 shares of company stock valued at $2,231,653 in the last three months. Insiders own 37.93% of the company's stock.

Hedge Funds Weigh In On Dolby Laboratories

A number of hedge funds and other institutional investors have recently made changes to their positions in DLB. Hantz Financial Services Inc. lifted its position in Dolby Laboratories by 166.7% in the 3rd quarter. Hantz Financial Services Inc. now owns 352 shares of the electronics maker's stock valued at $25,000 after acquiring an additional 220 shares in the last quarter. Rothschild Investment LLC lifted its position in Dolby Laboratories by 4,046.7% in the 3rd quarter. Rothschild Investment LLC now owns 622 shares of the electronics maker's stock valued at $45,000 after acquiring an additional 607 shares in the last quarter. Fifth Third Bancorp lifted its position in Dolby Laboratories by 34.7% in the 4th quarter. Fifth Third Bancorp now owns 746 shares of the electronics maker's stock valued at $48,000 after acquiring an additional 192 shares in the last quarter. Optiver Holding B.V. lifted its position in Dolby Laboratories by 7,955.6% in the 3rd quarter. Optiver Holding B.V. now owns 725 shares of the electronics maker's stock valued at $52,000 after acquiring an additional 716 shares in the last quarter. Finally, Aquatic Capital Management LLC bought a new stake in Dolby Laboratories in the 3rd quarter valued at $56,000. 58.56% of the stock is owned by institutional investors.

About Dolby Laboratories

Dolby Laboratories, Inc is a global leader in audio and imaging technologies, specializing in the development, licensing and deployment of solutions that enhance entertainment and communications experiences. The company's core business revolves around creating advanced audio codecs, noise reduction systems and spatial sound technologies for a wide range of applications, including cinema, broadcast, gaming, streaming and personal devices. Dolby's licensing model enables consumer electronics manufacturers, content creators and service providers to integrate its technologies into products such as televisions, smartphones, home theater systems and set-top boxes.

Among its flagship innovations are Dolby Atmos, an immersive audio format that delivers three-dimensional soundscapes for theaters and home systems; Dolby Digital and Dolby Digital Plus, widely adopted audio compression formats for broadcast and streaming; and Dolby Vision, a high-dynamic-range imaging technology that expands color, contrast and brightness in displays.

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