Sanmina (SANM) Valuation Check After ZT Systems Deal And Recent Share Price Swings

Simply Wall St.03-22

Sanmina (SANM) is drawing attention after recent share price moves, with the stock showing a 5.7% total return over the past year, along with multi-year gains and weaker performance in the past month....

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This suggests longer term momentum while near term sentiment has cooled.\nIf Sanmina's recent swing has you...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"DCF":"Dreyfus Alcentra Global Credit Income 2024 Target Term Fund, Inc","SANM":"新美亚电子","IE00B19Z6F94.USD":"Legg Mason Royce - US Smaller Companies A Acc USD","IE0034390439.USD":"FTGF ROYCE US SMALLER COMPANIES \"A\" (USD) D","BK4145":"电子制造服务","BK4588":"碎股","BK4585":"ETF&股票定投概念"},"translate_title":"ZT Systems交易和近期股价波动后Sanmina(SANM)估值检查","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"DCF":1,"SANM":1.5},"content_text":"Sanmina (SANM) is drawing attention after recent share price moves, with the stock showing a 5.7% total return over the past year, along with multi-year gains and weaker performance in the past month. See our latest analysis for Sanmina. The recent 1 month share price decline of 17.0% and 1 day move of 5.7% lower sit in sharp contrast to a 1 year total shareholder return of 56.9%. This suggests longer term momentum while near term sentiment has cooled. If Sanmina's recent swing has you thinking about other opportunities in tech hardware and automation, this could be a good moment to scan 32 robotics and automation stocks With Sanmina posting double digit annual revenue and net income growth along with a recent share price pullback, the key question is whether current levels still undervalue its manufacturing platform or if the market is already pricing in future growth. AdvertisementMost Popular Narrative: 37.8% Undervalued Sanmina's most followed narrative places fair value at $197.50 versus the last close of $122.86, framing a sizeable valuation gap that rests on specific growth and margin assumptions.  The imminent acquisition of ZT Systems is expected to add $5-6 billion of annual run-rate revenue, positioning Sanmina to double its net revenue within three years and capitalize on explosive growth in data center and AI infrastructure investment, this should provide a multi-year boost to overall revenue and EPS accretion from synergies and integration.  Read the complete narrative. Want to see what kind of revenue ramp and margin lift would need to play out for that valuation to hold? The core of this narrative leans on faster top line expansion, thicker margins and a richer earnings multiple that still sits below some sector peers. Curious which specific earnings trajectory and discount rate are doing the heavy lifting behind that $197.50 figure? Underpinning this fair value is a model that uses a 9.19% discount rate and assumes both revenue and earnings can compound at healthy rates, supported by a higher future P/E than today. Analysts in this narrative also build in buybacks, improving profitability and contribution from growth projects like AI infrastructure and energy, then discount those cash flows back to today to justify the current fair value band. Result: Fair Value of $197.50 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this upbeat narrative can quickly unwind if the ZT Systems acquisition drags on margins, or if any large customer meaningfully cuts orders. Find out about the key risks to this Sanmina narrative. Another Angle: Cash Flows Paint A Tougher Picture While the popular narrative sees Sanmina as 37.8% undervalued at a fair value of $197.50, the SWS DCF model points the other way. It provides an estimate of $75.91 versus the current $122.86 share price, which implies the stock is trading above that cash flow view and raises the question of which set of assumptions you trust more. Look into how the SWS DCF model arrives at its fair value. SANM Discounted Cash Flow as at Mar 2026Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Sanmina for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 53 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. Next Steps The mix of optimism around growth and concern about risks makes this a good time to look at the numbers yourself, decide where you stand, and then weigh the 3 key rewards and 2 important warning signs Looking for more investment ideas? If Sanmina has your attention, now is the time to broaden your watchlist with other opportunities that match your goals, risk comfort and income needs.  Target potential mispricings by scanning 53 high quality undervalued stocks that combine quality fundamentals with attractive entry points. Strengthen your income stream by reviewing 13 dividend fortresses built around higher yielding companies with staying power. Dial down portfolio stress by focusing on 67 resilient stocks with low risk scores designed to highlight businesses with more resilient risk profiles.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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