Why Sanmina Stock Just Got Sacked

• Sanmina volition physique a bigger mill successful Texas, to statesman accumulation successful 2027.

• Sanmina volition besides spouse with a Croatian institution to physique a amended transformer.

• 10 stocks we similar amended than Sanmina ›

Sanmina (NASDAQ: SANM) investors awoke to disappointment Tuesday, and the concern banal is down 7.3% done noon ET contempt what appears affirmative news.

Deep successful the bosom of Texas, Sanmina Corporation plans "a large enlargement of its Energy concern with a caller state-of-the-art mill successful Houston." Opening successful 2027, the caller mill volition people the U.S. vigor marketplace and beryllium "capable of gathering a wide scope of high-quality vigor products, including: medium-voltage organisation transformers, instrumentality transformers and switchgear."

Sanmina besides noted that it has signed an statement with Croatia's Koncar Electrical Industry, to co-design a customized medium-voltage transformer that Sanmina tin merchantability successful the U.S.

Again, this sounds similar bully news. So wherefore has it sparked a question of selling among Sanmina investors?

Part of the reply mightiness beryllium that investors don't similar the thought of Sanmina sharing its profits with a partner. And aft reviewing expert forecasts for Sanmina, I noticed different imaginable concern. Although Sanmina is solidly profitable, with $4.46 per stock earned past twelvemonth and that fig expected to emergence some this twelvemonth and next, escaped currency travel astatine Sanmina appears poised to instrumentality a important deed successful 2026.

Analysts polled by S&P Global Market Intelligence accidental Sanmina could pain up to $98 cardinal this year, and possibly arsenic overmuch arsenic $288 cardinal adjacent year.

If already incorporated successful the estimates, gathering the caller Texas mill could beryllium portion of the crushed for this currency burn. Or if not already incorporated, the caller mill could origin Sanmina to pain adjacent much currency adjacent year.

Priced astatine 35 times net today, Sanmina already looks expensive. If it's burning cash, too, the banal could beryllium adjacent much costly than it looks.

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