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Investing.com - Rosenblatt lowered its price target on Penguin Solutions (NASDAQ:PENG) to $30.00 from $36.00 on Wednesday, while maintaining a Buy rating on the stock. According to InvestingPro data, the stock currently trades near $27, with analyst targets ranging from $23 to $36, suggesting potential upside. The company’s financial health score is rated as "GOOD" by InvestingPro analysts.
The firm cited slightly below-consensus revenue for Penguin’s fourth quarter fiscal 2025, though the company’s Non-GAAP EPS exceeded forecasts. Penguin’s management guided for 6% year-over-year revenue growth for fiscal 2026, below the 10% growth analysts had modeled. The company has demonstrated strong revenue growth of 14% over the last twelve months, with a healthy gross profit margin of 29%.
The lower guidance includes only software and services revenue from Meta, as Penguin has limited near-term visibility into new Meta hardware deployments. Rosenblatt views this primarily as a timing issue related to Meta’s ongoing RSC buildout and Penguin’s fiscal calendar.
Penguin has expanded its customer base beyond hyperscalers, adding a tier-1 financial institution and a major consumer products company. The company’s Advanced Computing segment reported 75% year-over-year revenue growth for fiscal 2025, while its Integrated Memory business is projected to grow 10-20% year-over-year in fiscal 2026.
Rosenblatt continues to see significant value in Penguin’s HPC/AI software and services as enterprise AI adoption scales, recommending investors buy PENG shares on weakness tied to Meta’s hardware order timing. The stock has shown impressive momentum with an 86% return over the past six months. Get deeper insights and access to 12+ additional ProTips for PENG with InvestingPro, including detailed analysis of the company’s growth prospects and valuation metrics.
In other recent news, Penguin Solutions has reported its financial results for the fourth quarter of 2025, showing a notable performance. The company achieved a non-GAAP diluted earnings per share (EPS) of $0.43, surpassing analyst expectations of $0.30. Revenue for the same period was $337.9 million, reflecting a 9% year-over-year increase, although it fell slightly short of the consensus estimate of $342.5 million. Despite the revenue miss, the company’s earnings performance was well-received. Citizens has reiterated its Market Outperform rating for Penguin Solutions, maintaining a price target of $26.00. These developments indicate a positive outlook from analysts, as reflected in the reiterated rating by Citizens. The company’s financial results and analyst perspectives provide important insights for investors monitoring Penguin Solutions.
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