AI Beneficiary Flex Stock Declines After Q4 Print, What's Going On?

Flex Ltd FLEX traded lower by about 9% at $26.08 per share at last check on Wednesday.

The manufacturing company reported a fiscal fourth-quarter 2024 net sales decline of 11.7% year-on-year to $6.17 billion.

It beat the analyst consensus estimate of $6.11 billion.

The diversified manufacturing company’s adjusted EPS of 57 cents beat the consensus of 56 cents. The stock price declined after the print.

The gross margin increased 43 bps to 7.1%.

The adjusted operating margin improved by 120 bps to 5.4%.

Outlook: Flex expects fiscal first quarter 2025 revenue of $5.6 billion – $6.2 billion against $6.17 billion analyst consensus estimate and adjusted EPS of 37 cents – 45 cents versus 54 cents analyst consensus estimate.

The company projects fiscal 2025 revenue of $25.4 billion – $26.4 billion against $26.27 billion analyst consensus estimate and adjusted EPS of $2.30 – $2.50 versus $2.47 analyst consensus estimate.

Analysts consider Flex to be an AI beneficiary stock pick. Microsoft Corp MSFT, Alphabet Inc GOOG GOOGL and Meta Platforms Inc META are splurging on artificial intelligence tech. And Flex is expected to gain from the next Apple Inc AAPL product cycle.

Flex stock gained 89% in the last 12 months. Investors can gain exposure to the stock via Vanguard Information Tech ETF VGT and SPDR Portfolio Developed World Ex-US ETF SPDW.

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