On Tuesday, Lake Street Capital Markets adjusted its price target for Lantronix , Inc. (NASDAQ: NASDAQ:LTRX), a global provider of secure data access and management solutions for the Internet of Things (IoT). The firm has reduced the price target to $7.00 from the previous $8.00 while maintaining a Buy rating on the stock.
The revision follows Lantronix's recent financial performance and outlook, which has been met with a positive response. The company's solid results and future prospects have been highlighted as factors that could alleviate any remaining concerns regarding its growth potential, especially after the previous quarter's reduction in the fiscal year 2024 guidance.
The firm commended the ongoing developments at Gridspertise, a subsidiary of Lantronix, and the management's optimistic stance on the long-term opportunities this segment presents. Despite the need for Lantronix to compensate for some of the revenue from Gridspertise in fiscal year 2025 following a significant increase in fiscal year 2024, the belief is that Lantronix is on track to achieve sustained growth in both revenue and earnings next year.
Lake Street Capital Markets noted that Lantronix's shares are currently trading at only 7 times the firm's projected earnings per share for 2025, excluding cash. This valuation presents what the firm considers an attractive risk/reward situation for investors at the current price levels.
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