Key Stats for ALAB Stock
- Price Change for ALAB stock: -21.41%
- ALAB Share Price as of Feb. 11: $143.71
- 52-Week High: $262.90
- ALAB Stock Price Target: $201.90
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What Happened?
Astera Labs (ALAB) shares fell more than 20% after the company reported quarterly results, even though revenue and earnings exceeded analyst expectations, because investors reassessed valuation following the stock’s sharp run-up.
The company reported quarterly revenue of $271 million, which beat consensus estimates by over 8%, while adjusted EPS of $0.58 exceeded expectations by roughly 13%.
EBITDA and operating income also came in well ahead of estimates, and margins expanded meaningfully year over year, reflecting operating leverage as demand for AI and cloud connectivity solutions remained strong.
Despite the solid beat, the stock sold off sharply, as expectations had risen significantly following a multi-month rally, and investors appeared to lock in gains amid elevated valuation multiples.
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Analysts continue to see higher long-term value for Astera Labs, with a mean price target of $202, which sits above the current share price following the pullback.
The median price target is $205, while the high target reaches $275, reflecting optimism around Astera Labs’ positioning in high-speed connectivity for AI data centers.
On the downside, the low price target stands at $153, suggesting analysts see support levels even after the recent volatility.
The latest Street Targets data shows a target-to-price ratio of 140.5%, highlighting that expectations remain elevated despite the near-term correction.
What the Market Is Telling Us About ALAB Stock
Astera Labs continues to deliver exceptional growth, but the recent move suggests the market is becoming more sensitive to valuation as expectations rise.
LTM revenue reached $853 million, up over 115% year over year, driven by strong demand from hyperscalers and AI infrastructure customers.
Gross margins remained strong at 75.7%, while operating margins expanded to 20.3%, underscoring the company’s ability to scale profitably.
Free cash flow totaled $282 million over the last twelve months, with free cash flow margins above 33%, signaling strong cash generation alongside growth.
The balance sheet remains solid, with nearly $1.2 billion in cash and short-term investments, and no material leverage, providing flexibility for continued investment.
However, ALAB trades at elevated multiples, including a forward EV-to-EBITDA ratio above 50x, so valuation sensitivity remains a key risk during periods of market volatility.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
