Penguin Solutions, Inc. (PENG) AI Stock Analysis

Penguin Solutions, Inc. designs, builds, deploys, and manages enterprise solutions across three segments: Advanced Computing, Integrated Memory, and Optimized LED. Its offerings include technical computing hardware, software, and services for core and cloud environments, featuring Penguin Solutions OriginAI for GPU deployment at scale. Under the Stratus brand, it delivers continuous data and application availability. Through SMART Modular Technologies, it supplies DRAM modules, solid-state storage, and integrated memory for data analytics and networking. It also provides Zefr modules, Altus and AMD EPYC based servers, flash memory products, supply chain services, and packaged LED components under the Cree LED brand.

For FY2026, Penguin Solutions generated revenue of $1.73B, up 26.5% from $1.37B in FY2025 and recovering from $1.17B in FY2024. Over the five years from FY2021 to FY2026, revenue increased at a compound annual growth rate of 10.4%. Net income reached $180.6M in FY2026 with a net margin of 10.4%, up from $21.6M in FY2025 and net losses of -$52.5M in FY2024 and -$187.5M in FY2023. Gross margin stood at 27.7% in FY2026 compared to 28.8% in FY2025. In the latest quarter ended August 31, 2026, quarterly revenue grew 67.7% year-over-year while quarterly earnings expanded by 1188.7%.

As of August 31, 2026, Penguin Solutions held $647.2M in cash and short-term investments against total debt of $846.8M, resulting in net debt of $199.6M. The company reported a current ratio of 1.88 and a debt-to-equity ratio of 1.17 on shareholders' equity of $723.5M. In FY2026, operating cash flow was -$151.9M and capital expenditures were $11.6M, producing free cash flow of -$163.5M. Capital allocation in FY2026 included $86.7M directed to share buybacks, while the share count increased 17.2% over 5 years.

Penguin Solutions carries a market capitalization of $2.93B and an enterprise value of $3.03B. The stock trades at a trailing price-to-earnings multiple of 22.0x, below the 28.1x median of its US-listed Technology peers. Its forward P/E of 12.5x is lower than the peer group median of 18.8x, and its price-to-sales multiple is 1.7x compared to the peer median of 2.8x. However, its enterprise value to EBITDA stands at 17.1x, above the peer median of 16.6x. Over the past year, PENG returned 153.9%, outperforming the S&P 500 return of 16.8%.

Wall Street coverage includes 5 Strong Buy, 2 Buy, 0 Hold, 1 Sell, and 0 Strong Sell recommendations. The mean price target is $85.62, which represents a 50.0% premium over the last close of $57.10. For the fiscal year ending August 31, 2027, consensus estimates project revenue of $2.45B and an EPS of $4.56, representing 58.8% EPS growth. Over the last 4 quarters, Penguin Solutions beat EPS expectations in 4 quarters.

This page is an AI-written research summary of Penguin Solutions, Inc. (PENG). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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