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1. Company Snapshot

1.a. Company Description

Sanmina Corporation provides integrated manufacturing solutions, components, products and repair, logistics, and after-market services worldwide.It operates in two businesses, Integrated Manufacturing Solutions; and Components, Products and Services.The company offers product design and engineering, including concept development, detailed design, prototyping, validation, preproduction, manufacturing design release, and product industrialization; assembly and test services; direct order fulfillment and logistics services; after-market product service and support; and supply chain management services, as well as engages in the manufacturing of components, subassemblies, and complete systems.


In addition, the company provides interconnect systems, such as printed circuit board fabrication, backplane, cable assemblies, and plastic injection moldings; mechanical systems comprising enclosures and precision machining; memory, storage platforms, radio frequency, optical, and microelectronic solutions; defense and aerospace products; and cloud-based manufacturing execution software.It offers its products and services primarily to original equipment manufacturers in the industrial, medical, defense and aerospace, automotive, communications networks, and cloud solutions industries.Sanmina Corporation was founded in 1980 and is headquartered in San Jose, California.

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1.b. Last Insights on SANM

Breaking News: Sanmina Corporation reported strong Q2 earnings, with revenues surging 102% to $4.01 billion, driven by the acquisition of ZT Systems and robust demand in AI and data centers. The company delivered a double beat, with growth momentum remaining solid in its core business. Sanmina guides for good earnings ahead, citing the expanding AI data center market as a growth platform. The 2027 guidance targets over $16 billion in sales and earnings of $11 per share. Some analysts have downgraded their rating, citing pulled-forward sales, while maintaining a positive outlook. Hold recommendation given by some analysts.

1.c. Company Highlights

2. Sanmina Q2 FY26: Strong Momentum, AI‑Driven Growth

Sanmina reported Q2 FY26 revenue of $4.01 billion, a 7.3% YoY increase, with a non‑GAAP operating margin of 6.4% and diluted EPS of $3.16—exceeding the $2.42 consensus (Sanmina CFO, Q2 2026 earnings call). The company’s P/E ratio sits at 39.3, while its EV/EBITDA stands at 29.7, reflecting premium pricing for its high‑margin EMS/ODM capabilities.

Publication Date: Apr -28

📋 Highlights
  • Revenue and Profit Growth: Q2 revenue hit $4.01B with non-GAAP operating margin of 6.4% and EPS of $3.16, driven by ZT Systems’ $1.88B performance.
  • Strong Cash Flow and Balance Sheet: Generated $399M cash flow from operations and holds $1.58B cash, with $1.5B undrawn revolver capacity.
  • 2026 Guidance Confirmed: Full-year revenue projected at $13.7–14.3B (~7.3% YoY growth), with non-GAAP operating margin of 6.3–6.6% and EPS of $10.75–11.35.
  • 2027 Revenue Target: Aims for $16B+ by FY2027, fueled by AI infrastructure expansion and partnerships with all five major cloud customers.

Core Sanmina Growth

Core Sanmina business grew 7.3% YoY, driven by robust demand in industrial & energy, medical, defense & aerospace, and automotive & transportation segments, each maintaining or improving margin profiles.

ZT Systems Surge

ZT Systems delivered $1.88 billion in revenue, surpassing expectations thanks to strong execution and cloud customer demand, positioning it to reach $5–$6 billion in FY26.

Segment Highlights

The Communication Networks & Cloud AI Infrastructure group posted $1.24 billion, flat YoY, while the traditional telecom business continued to grow, buoyed by 5G and high‑performance switching deployments.

Bookings & Capacity

Bookings for Q2 exceeded a 1.1 book‑to‑bill ratio, with inventory levels rising to support future demand, yet capacity remains unconstrained per CEO Jure Sola.

Capital Allocation & Share Repurchase

The Board authorized an additional $600 million of share repurchases, complementing a $1.58 billion cash reserve and a $1.5 billion revolver free of borrowings.

Outlook & Guidance

For Q3, revenue is projected at $3.2–$3.5 billion with a 6.4–6.9% operating margin, while FY26 revenue is forecast at $13.7–$14.3 billion, mid‑point $14 billion, and EPS $10.75–$11.35.

Financial Strength & Cash Flow

Cash flow from operations reached $399 million, generating nearly $300 million in free cash flow, and the company expects to maintain a leverage ratio near 1.63× EBITDA.

R&D & Strategic Shift

Sanmina is investing in R&D to transition from EMS to value‑add ODM, with expenses rising but still capable of supporting 15% revenue growth in FY27.

Component Supply & Risk Management

Material shortages in memory and custom ASICs are managed daily via IT systems and supplier relationships; the company sees no risk to its FY27 $16 billion target.

3. NewsRoom

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What Makes Sanmina (SANM) a New Strong Buy Stock

May -01

Source: zacks.com

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New Strong Buy Stocks for May 1st

May -01

Source: zacks.com

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Sanmina: Solid Q2 Beat, Stock Remains A Bargain At Just 19x FY26 P/E

Apr -30

Source: seekingalpha.com

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Sanmina Q2 Earnings Call Highlights

Apr -29

Source: defenseworld.net

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Sanmina: The 2027 Guidance Provides Comfort

Apr -28

Source: seekingalpha.com

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Sanmina Beats Q2 Earnings Estimates on Solid ZT Systems Momentum

Apr -28

Source: zacks.com

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Sanmina: Market Finally Realizes Growth Potential (Rating Downgrade)

Apr -28

Source: seekingalpha.com

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Sanmina Corporation (SANM) Q2 2026 Earnings Call Transcript

Apr -27

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.57%)

6. Segments

Integrated Manufacturing Solutions

Expected Growth: 8%

Sanmina's Integrated Manufacturing Solutions' 8% growth is driven by increasing demand for complex electronics, growing adoption of IoT and 5G technologies, and expansion into new markets such as healthcare and aerospace. Additionally, the company's focus on operational efficiency, supply chain optimization, and strategic acquisitions contribute to its growth momentum.

Components, Products and Services

Expected Growth: 6%

Sanmina Corporation's 6% growth is driven by its Components segment, led by increasing demand for complex PCBs and optical components. The Products segment benefits from growing sales of storage and networking equipment. The Services segment is fueled by rising demand for electronics manufacturing services, particularly in the industrial, medical, and automotive markets.

Intersegment Revenue

Expected Growth: 5%

Sanmina Corporation's 5% intersegment revenue growth is driven by increasing demand for electronic manufacturing services in the industrial, medical, and automotive sectors. Additionally, the company's strategic acquisitions, expanded manufacturing capabilities, and cost savings initiatives have contributed to the growth. Furthermore, the rising trend of outsourcing manufacturing services and the need for supply chain optimization have also fueled the segment's revenue growth.

7. Detailed Products

Printed Circuit Boards (PCBs)

Sanmina designs and manufactures complex printed circuit boards for various industries, including automotive, industrial, medical, and aerospace.

Backplane Assemblies

Sanmina designs and manufactures custom backplane assemblies for high-performance computing, data storage, and networking applications.

Cable Assemblies

Sanmina designs and manufactures custom cable assemblies for various industries, including automotive, industrial, medical, and aerospace.

Optical and Photonics

Sanmina designs and manufactures optical and photonic components, including optical transceivers, optical engines, and optical interconnects.

Mechanical Systems

Sanmina designs and manufactures custom mechanical systems, including enclosures, chassis, and thermal management solutions.

Electromechanical Assemblies

Sanmina designs and manufactures custom electromechanical assemblies, including power supplies, fans, and other components.

Design and Engineering Services

Sanmina offers design and engineering services, including product design, prototyping, and testing.

Manufacturing and Test Services

Sanmina offers manufacturing and test services, including PCB assembly, box build, and functional testing.

8. Sanmina Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Sanmina Corporation operates in the electronics manufacturing services (EMS) industry, which is characterized by a moderate threat of substitutes. While there are some substitutes available, such as original design manufacturers (ODMs) and contract manufacturers, they are not a significant threat to Sanmina's business.

Bargaining Power Of Customers

Sanmina Corporation's customers, such as Cisco Systems, Hewlett Packard Enterprise, and IBM, have significant bargaining power due to their large size and purchasing power. This gives them the ability to negotiate prices and terms, which can negatively impact Sanmina's profitability.

Bargaining Power Of Suppliers

Sanmina Corporation's suppliers, such as component manufacturers, have limited bargaining power due to the company's large scale and global presence. This gives Sanmina the ability to negotiate favorable prices and terms with its suppliers.

Threat Of New Entrants

The threat of new entrants in the EMS industry is low due to the high barriers to entry, including the need for significant capital investment, specialized equipment, and a skilled workforce. This makes it difficult for new companies to enter the market and compete with established players like Sanmina.

Intensity Of Rivalry

The EMS industry is highly competitive, with several large players competing for market share. Sanmina Corporation faces intense competition from companies like Flex, Jabil, and Celestica, which can lead to pricing pressure and reduced profitability.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 12.73%
Debt Cost 8.98%
Equity Weight 87.27%
Equity Cost 8.98%
WACC 8.98%
Leverage 14.59%

11. Quality Control: Sanmina Corporation passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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ESCO Technologies

A-Score: 5.8/10

Value: 3.0

Growth: 7.7

Quality: 7.6

Yield: 0.0

Momentum: 9.0

Volatility: 7.3

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Teledyne Technologies

A-Score: 5.4/10

Value: 3.1

Growth: 6.3

Quality: 6.8

Yield: 0.0

Momentum: 7.0

Volatility: 9.3

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Sanmina

A-Score: 4.9/10

Value: 4.2

Growth: 6.2

Quality: 5.7

Yield: 0.0

Momentum: 10.0

Volatility: 3.0

1-Year Total Return ->

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Vontier

A-Score: 4.6/10

Value: 5.5

Growth: 3.7

Quality: 6.4

Yield: 0.0

Momentum: 5.0

Volatility: 7.3

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Littelfuse

A-Score: 4.5/10

Value: 3.3

Growth: 4.2

Quality: 6.1

Yield: 1.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

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Plexus

A-Score: 4.2/10

Value: 4.0

Growth: 6.2

Quality: 5.5

Yield: 0.0

Momentum: 3.5

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

223.27$

Current Price

223.27$

Potential

-0.00%

Expected Cash-Flows