SANM · Sanmina
Conviction · Medium · more likely to lead the S&P 500 over the next three months, by a modest margin
Wrong if: a daily close below $149
Note written ·
How this view changed
- · Rating raised from Low to Medium. Results, 9 November 2026: Fiscal Q4 2026 revenue of $3.86B and non-GAAP operating margin of 9.0% exceeded the $3.3–3.6B and 7.5–8.0% guidance, and fiscal 2027 revenue guidance was set at $17.5–19.5B.
Price against the kill line
6.2% clear of its kill line on the 13 November 2026 close.
How to read this
The red mark is the price level of the published kill line: a close through it (a weekly close, on a weekly line) would prove the research note wrong on price. The dot is where the stock closed on 13 November 2026; a dot left of the mark has closed through its line.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close below $149.00, on record since 11 November 2026. The shares are down 27.1% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close below $149, under the 9 November 2026 pre-report close, which would erase the post-report recovery. Fiscal first-quarter revenue below the $3.8 billion low end of guidance, or non-GAAP operating margin below 7.0%, would also show the case failing.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Technology
Quarter to 27 June 2026, filed 27 July 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 3,464
- Revenue, change on a year (%)
- +69.7
- Gross margin (%)
- 10.5
- Operating margin (%)
- 6.4
- Free cash flow, four quarters ($M)
- 594
- Net cash, cash less debt ($M)
- −327
- Price to earnings (×)
- 27.5
- Enterprise value to sales (×)
- 0.7
All filed numbers
What Sanmina reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 3,464 | +69.7 | 10.5 | 6.4 |
| first filed | 4,013 | +102.3 | 8.8 | 3.9 |
| first filed | 3,190 | +59.0 | 7.6 | 2.3 |
| first filed | 2,096 | +3.9 | 9.1 | 3.7 |
| first filed | 2,042 | +10.9 | 8.9 | 4.7 |
| first filed | 1,984 | +8.1 | 8.9 | 4.6 |
| Pre-tax income ($M) | 192 |
| Net income ($M) four quarters: 308 | 117 |
| Diluted shares, change on a year (%) against the quarter to 28 June 2025 | +1.2 |
| Operating cash flow ($M) | 901 |
| Capital spending ($M) | 307 |
| Free cash flow ($M) | 594 |
| Cash and short-term investments ($M) | 1,845 |
| Debt ($M) non-current long-term debt plus current debt | 2,172 |
| Net cash, cash less debt ($M) | −327 |
| Deferred revenue ($M) | 180 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | Not reported |
| Inventory ($M) | 3,152 |
| Shareholders' equity ($M) including non-controlling interests | 2,760 |
| Market value ($M) | 8,485 |
| Enterprise value, market value plus net debt ($M) | 8,812 |
| Enterprise value to sales (×) | 0.7 |
| Enterprise value to operating income (×) | 16.6 |
| Price to earnings (×) | 27.5 |
| Price to book value (×) | 3.1 |
| Free-cash-flow yield (%) | 7.0 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 3.1% of shares outstanding sold short, 2.8 days of average trading to cover, −0.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $48K |
| 12 monthsfrom | $100K | $43.0M |
The thesis
Sanmina Corporation is more likely than not to beat the S&P 500 over the next three months. Its fiscal fourth-quarter report on 9 November 2026 beat every range the company set in July, and fiscal 2027 guidance calls for roughly a quarter more revenue. The fiscal first-quarter report, expected around 26 January 2027, shows whether non-GAAP operating margin (profit before specified accounting items) holds in the guided 7.0–7.5% range.
The quarter ended 3 October 2026. Revenue was $3.86 billion against guidance of $3.3–3.6 billion. Non-GAAP operating margin was 9.0% against guidance of 7.5–8.0%. Non-GAAP earnings per share were $4.43 against an analyst estimate of $3.27 (Sanmina 8-K, 9 November 2026; Benzinga).
Fiscal 2027 guidance is revenue of $17.5–19.5 billion and non-GAAP earnings per share of $15.50–17.50. Benzinga listed pre-report analyst estimates of $16.56 billion and $14.06. Fiscal first-quarter guidance is revenue of $3.8–4.1 billion and earnings per share of $3.50–3.85, against estimates of $3.421 billion and $2.82.
The shares closed at $164.48 on 12 November 2026, up from $149.64 on 9 November 2026, the close before the results reached the market. They remain 43.0% below the 52-week high of $288.68 (3 June 2026) and under both long-term averages, so the price still discounts part of the guidance.
Bullish and bearish views on Sanmina Corporation
The bull case on Sanmina Corporation (SANM), in brief: results beat guidance by wide margins. The bear case: the margin guide steps down.
Bull case
- Results beat guidance by wide margins. Fiscal fourth-quarter revenue of $3.86 billion topped the top of the $3.3–3.6 billion range issued on 27 July 2026. The 9.0% non-GAAP operating margin topped the 8.0% top of its range (Sanmina 8-K, 9 November 2026).
- Fiscal 2027 outlook is above analyst marks. Guided revenue of $17.5–19.5 billion compares with a $16.56 billion analyst estimate before the report (Benzinga, 9 November 2026). The chief executive said the midpoint implies about 27% revenue growth.
- Cash conversion improved. Fourth-quarter operating cash flow was $242 million and free cash flow was $83 million, against $124 million and $24 million in the June quarter (Sanmina 8-Ks, 27 July 2026 and 9 November 2026). Fiscal 2026 free cash flow was $541 million.
- The core business is growing on its own. The chief executive said the core Sanmina business grew by double digits from a year earlier, apart from the ZT Systems rack business acquired in 2025.
- The company is buying back shares. Sanmina repurchased $154 million of stock in the fourth quarter and $393 million in fiscal 2026 (8-K, 9 November 2026).
Bear case
- The margin guide steps down. Fiscal 2027 and fiscal first-quarter non-GAAP operating margin are both guided to 7.0–7.5%, against 9.0% in the fourth quarter and 8.0% in the third (8-Ks, 27 July 2026 and 9 November 2026). Revenue growth at lower margin limits the earnings gain.
- The shares trade below both long-term averages. The last close of $164.48 on 12 November 2026 compares with a 50-day average of $190.52 and a 200-day average of $190.97. The shares are down 22.0% over three months from a close of $210.84 on 14 August 2026.
- GAAP earnings are about half the adjusted figure. Fourth-quarter GAAP earnings per share were $2.14 against $4.43 non-GAAP. The release includes a $78 million fourth-quarter fair-value charge on ZT Systems contingent consideration, $150 million for the year.
- Analysts are not uniformly positive. JPMorgan kept a Neutral rating and lowered its price target to $230 on 10 November 2026 (Benzinga).
- Guidance ranges are wide. The fiscal 2027 revenue range spans $2 billion and the earnings range spans $2.00 per share (8-K, 9 November 2026).
Price setup
The shares closed at $130.23 on 5 November 2026 and $134.68 on 6 November 2026. They then closed at $149.64 on 9 November 2026, $155.43 on 10 November 2026, $159.25 on 11 November 2026 and $164.48 on 12 November 2026. Each close since the report has been higher than the one before. MarketBeat reported an opening price of $166.40 on 10 November 2026, just above the last close.
The 52-week closing low is $122.86 on 20 March 2026. The 52-week high is $288.68 on 3 June 2026. The 50-day average of $190.52 is the nearest reference above the shares, and the 200-day average is $190.97.
Insider selling is small. Director Susan Johnson sold 120 shares at $200.46 on 17 September 2026 and 120 shares at $202.69 on 28 August 2026, both under a Rule 10b5-1 plan (SEC Form 4 filings). MarketBeat gave a beta of 1.72 on 10 November 2026, meaning larger swings than the market.
Catalysts ahead
- ~25 November 2026 (est.): Annual report on Form 10-K for fiscal 2026. Shows customer concentration and the ZT Systems contribution in full detail.
- 9 December 2026: Federal Reserve rate decision. Rate fears were the sector explanation for the October chip-share decline, so the outcome bears on the shares.
- ~26 January 2027 (est.): Fiscal first-quarter 2027 report. Tests the $3.8–4.1 billion revenue and 7.0–7.5% non-GAAP operating margin guidance that settles the call.
What would change the view
A daily close below $149, under the 9 November 2026 pre-report close, which would erase the post-report recovery. Fiscal first-quarter revenue below the $3.8 billion low end of guidance, or non-GAAP operating margin below 7.0%, would also show the case failing.
The risks this note tracks, each with what would confirm it:
- Operating margin steps down to the guided 7.0–7.5% from 9.0% as lower-margin rack revenue grows. Confirmed by: fiscal first-quarter non-GAAP operating margin below 7.0% at the report expected around 26 January 2027.
- Chip and AI-hardware shares keep falling on interest-rate pressure regardless of company results. Confirmed by: a sharp fall in Nasdaq chip names after the 9 December 2026 Federal Reserve decision, with Sanmina closing below its 9 November 2026 pre-report close of $149.64.
- Revenue depends heavily on AMD-linked ZT Systems programs. Confirmed by: ZT Systems revenue disclosed below the $1.1 billion of the June quarter, or a fiscal 2027 revenue outlook cut below $17.5 billion.
- Adjusted earnings overstate cash and GAAP profit through repeated contingent-consideration adjustments. Confirmed by: a further ZT fair-value charge in fiscal 2027, or free cash flow falling back toward the $24 million of the June quarter.
What it trades with
Sanmina trades with electronics manufacturing services peers, AI server and rack builders, and AMD-linked supply chains. Jabil reported fiscal fourth-quarter revenue of $10.6 billion on 30 September 2026 and guided fiscal 2027 revenue to about $44.5 billion (Jabil 8-K). Mid-October weakness in chip shares on rate fears also hit Sanmina (MarketBeat, 15 October 2026), so moves in Nasdaq chip names and Treasury yields carry through to the shares.
The evidence, claim by claim (8)
- Fiscal fourth-quarter 2026 revenue was $3.86 billion, non-GAAP operating margin 9.0%, non-GAAP EPS $4.43; fiscal 2026 revenue $14.53 billion and non-GAAP EPS $13.28. Sanmina fiscal 2026 fourth-quarter results, 8-K exhibit 99.1 · as of
- Fiscal 2027 guidance: revenue $17.5–19.5 billion, non-GAAP operating margin 7.0–7.5%, non-GAAP EPS $15.50–17.50; fiscal first quarter revenue $3.8–4.1 billion and EPS $3.50–3.85. Sanmina fiscal 2026 fourth-quarter results, 8-K exhibit 99.1 · as of
- Fiscal fourth-quarter operating cash flow was $242 million and free cash flow $83 million; fiscal 2026 free cash flow was $541 million; fourth-quarter repurchases were $154 million. Sanmina fiscal 2026 fourth-quarter results, 8-K exhibit 99.1 · as of
- Analyst estimates before the report were fourth-quarter EPS $3.27 and revenue $3.478 billion; fiscal 2027 EPS $14.06 and revenue $16.56 billion; fiscal first-quarter EPS $2.82 and revenue $3.421 billion. Benzinga headlines · as of
- JPMorgan maintained a Neutral rating and lowered its price target to $230. Benzinga headline, JP Morgan Maintains Neutral on Sanmina · as of
- Shares opened at $166.40 on 10 November 2026 against a prior close of $149.64. MarketBeat, Sanmina shares gap up following earnings beat · as of
- Closing prices rose each session after the report: $149.64 on 9 November 2026, $155.43 on 10 November 2026, $159.25 on 11 November 2026 and $164.48 on 12 November 2026. Daily closing prices · as of
- Director Susan Johnson sold 120 shares at $200.46 on 17 September 2026 under a Rule 10b5-1 plan. SEC Form 4, filed 21 September 2026 · as of
Sources
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