Wall Street Zen Downgrades Penguin Solutions (NASDAQ:PENG) to Buy

Key Points

• Wall Street Zen downgraded Penguin Solutions from “strong-buy” to “buy”, even though the stock still carries an overall Moderate Buy consensus rating and a $63.33 average price target.
• Penguin Solutions reported better-than-expected quarterly results, posting EPS of $0.84 versus estimates of $0.63 and revenue of $478.71 million versus $407.47 million expected. Analysts now expect the company to earn 2.08 EPS for the current year.
• The stock was down 7.8% to an opening price of $53.85, while recent insider selling totaled 58,351 shares over the last three months. Institutional investors have also been making small increases to their positions.

Penguin Solutions (NASDAQ:PENG - Get Free Report) was downgraded by investment analysts at Wall Street Zen from a "strong-buy" rating to a "buy" rating in a report issued on Sunday.

PENG has been the subject of a number of other research reports. Zacks Research upgraded shares of Penguin Solutions from a "hold" rating to a "strong-buy" rating in a research note on Tuesday, June 30th. Weiss Ratings raised Penguin Solutions from a "hold (c-)" rating to a "hold (c)" rating in a report on Wednesday, July 8th. Rosenblatt Securities raised their target price on Penguin Solutions from $65.00 to $75.00 and gave the stock a "buy" rating in a research report on Monday, July 6th. Needham & Company LLC boosted their price target on Penguin Solutions from $60.00 to $80.00 and gave the company a "buy" rating in a research note on Wednesday, July 8th. Finally, Citigroup reiterated an "outperform" rating on shares of Penguin Solutions in a research report on Wednesday, July 8th. One analyst has rated the stock with a Strong Buy rating, six have given a Buy rating, one has assigned a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and a consensus price target of $63.33.

Penguin Solutions Stock Down 7.8%

PENG opened at $53.85 on Friday. The company has a market capitalization of $2.76 billion, a P/E ratio of 38.19 and a beta of 2.83. The company has a debt-to-equity ratio of 0.65, a current ratio of 1.54 and a quick ratio of 1.10. The firm's fifty day moving average price is $62.97 and its two-hundred day moving average price is $36.89. Penguin Solutions has a fifty-two week low of $16.04 and a fifty-two week high of $89.86.

Penguin Solutions (NASDAQ:PENG - Get Free Report) last released its quarterly earnings data on Tuesday, July 7th. The company reported $0.84 EPS for the quarter, topping analysts' consensus estimates of $0.63 by $0.21. Penguin Solutions had a net margin of 6.44% and a return on equity of 28.23%. The company had revenue of $478.71 million during the quarter, compared to the consensus estimate of $407.47 million. During the same period last year, the firm earned $0.52 EPS. On average, analysts anticipate that Penguin Solutions will post 2.08 EPS for the current year.

Insider Activity at Penguin Solutions

In other Penguin Solutions news, SVP Joseph Gates Clark sold 10,351 shares of the company's stock in a transaction on Monday, June 1st. The stock was sold at an average price of $58.87, for a total transaction of $609,363.37. Following the transaction, the senior vice president owned 66,425 shares of the company's stock, valued at approximately $3,910,439.75. This represents a 13.48% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, SVP Anne Kuykendall sold 4,000 shares of the company's stock in a transaction on Monday, June 15th. The stock was sold at an average price of $64.38, for a total value of $257,520.00. Following the transaction, the senior vice president directly owned 120,794 shares in the company, valued at approximately $7,776,717.72. This represents a 3.21% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 58,351 shares of company stock valued at $2,859,351 over the last three months. 2.90% of the stock is owned by company insiders.

Institutional Investors Weigh In On Penguin Solutions

A number of institutional investors and hedge funds have recently made changes to their positions in PENG. Allworth Financial LP lifted its stake in shares of Penguin Solutions by 41.4% during the third quarter. Allworth Financial LP now owns 1,792 shares of the company's stock valued at $47,000 after acquiring an additional 525 shares during the period. Osaic Holdings Inc. increased its position in Penguin Solutions by 20.8% in the second quarter. Osaic Holdings Inc. now owns 3,583 shares of the company's stock worth $71,000 after purchasing an additional 617 shares during the period. Covestor Ltd raised its holdings in Penguin Solutions by 4.7% during the 4th quarter. Covestor Ltd now owns 15,535 shares of the company's stock worth $304,000 after purchasing an additional 695 shares during the last quarter. M&T Bank Corp raised its holdings in Penguin Solutions by 7.0% during the 4th quarter. M&T Bank Corp now owns 10,851 shares of the company's stock worth $212,000 after purchasing an additional 706 shares during the last quarter. Finally, Optimize Financial Inc lifted its position in Penguin Solutions by 1.5% during the 4th quarter. Optimize Financial Inc now owns 56,354 shares of the company's stock valued at $1,102,000 after purchasing an additional 808 shares during the period.

Penguin Solutions Company Profile

Penguin Solutions, Inc engages in the designing and development of enterprise solutions worldwide. It operates through three segments: Advanced Computing, Integrated Memory, and Optimized LED. It offers dynamic random access memory modules, solid-state and flash storage, and other advanced integrated memory solutions for networking and telecom, data analytics, artificial intelligence and machine learning applications; and supply chain services, including procurement, logistics, inventory management, temporary warehousing, programming, kitting, and packaging services.

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