Plexus (PLXS) Is Up 6.1% After CPI and Small Business Optimism Fuel Interest Rate Hopes

• Following the release of the July Consumer Price Index (CPI) report last week, which showed annual inflation steady at 2.7% and matched expectations, market confidence grew as the likelihood of a Federal Reserve interest rate cut jumped above 94%.
• Additional momentum was fueled by the National Federation of Independent Business (NFIB) Small Business Optimism Index reaching a five-month high, driving increased optimism and gains across IT services, staffing, and manufacturing sectors.
• With inflation data boosting hopes for lower borrowing costs, we'll explore how these macroeconomic shifts could influence Plexus's growth outlook and industry positioning.

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Plexus Investment Narrative Recap

To invest in Plexus, you generally need to believe in the ongoing demand for advanced electronics manufacturing across sectors like healthcare, defense, and semiconductors, a growth story that relies on sector expansion and successful program wins, but faces risks from customer demand volatility and global tariff uncertainties. The recent improvement in inflation data and hopes for lower rates may support near-term customer sentiment, yet the most pressing catalyst remains sustained order activity amid ongoing demand pushouts in high-growth verticals; the impact of this news, while constructive for market confidence, does not materially change Plexus's biggest risk: sensitivity to customer-specific order fluctuations. Among Plexus's latest announcements, its Q4 2025 guidance highlights expectations for sequential revenue growth driven by expanding customer programs and new market opportunities, despite persistent headwinds from tariffs and program-driven fluctuations. This update is particularly relevant in the context of a more optimistic macro backdrop, offering insight into how well the company may be positioned to capture momentum if sector sentiment strengthens further. However, it's important to also consider that, despite stronger demand signals, investors should be aware that the exposure to high customer concentration means...

Read the full narrative on Plexus (it's free!)

Plexus' outlook anticipates $4.8 billion in revenue and $209.2 million in earnings by 2028. This implies a 6.0% annual revenue growth rate and a $46.5 million increase in earnings from the current $162.7 million.

Uncover how Plexus' forecasts yield a $154.60 fair value, a 14% upside to its current price.

Exploring Other Perspectives

Only one fair value estimate from the Simply Wall St Community stands at US$114.18, reflecting a focused but singular viewpoint. As investors look beyond valuation, ongoing volatility in key customer demand remains a critical factor that could influence the company's performance amid shifting economic sentiment.

Explore another fair value estimate on Plexus - why the stock might be worth 16% less than the current price!

Build Your Own Plexus Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Plexus research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Plexus research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Plexus' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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