Astera Labs, Inc. (ALAB) AI Stock Analysis

• Market Cap: $31.70B
• Dividend Yield: N/A
• Average Volume (3M): 6.01M
• Price to Earnings (P/E): 325.9
• Beta (1Y): 2.57
• Revenue Growth: 163.80%
• EPS Growth: N/A
• Country: US
• Employees: 440
• Sector: General
• Sector Strength: N/A
• Industry: Semiconductors
• EPS (TTM): 0.44
• Shares Outstanding: 166,219,150
• 10 Day Avg. Volume: 7,407,676
• 30 Day Avg. Volume: 6,012,074
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.48
• Enterprise Value/Revenue: 24.89
• Enterprise Value/Gross Profit: 32.95
• Enterprise Value/Ebitda: 323.06
• 1Y Price Target: $165.00
• Price Target Upside: -11.22% Downside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15

• Rating: 68 Neutral
• Price Target: $190.00 ▲(2.23% Upside)

Astera Labs' overall stock score is driven by strong financial performance and positive earnings call highlights, indicating growth potential. However, high valuation metrics and increased operating expenses present risks. The technical analysis suggests bullish momentum, but caution is warranted due to overbought signals.

Positive Factors

AI Infrastructure Investment

The faster ramp-up of its new Scorpio P-series switch helped drive upside in the quarter, while management’s commentary on X-series engagement across ten different customers increases confidence in Astera’s position as a leading provider of high-value connectivity solutions.

Market Position

Astera Labs is a rapidly growing share gainer in the connectivity chip market.

Product Growth

Astera Labs posted another significant beat and raise, driven by growth across Scorpio, Aries, and Taurus.

Negative Factors

Earnings Pressure

Despite the strong top-line guidance, non-GAAP EPS were guided to decrease sequentially in the third quarter, pressured by a higher effective tax rate of 20%.

Stock Price Volatility

The setup going into the quarter has become more challenging, with the stock up 25% over the last month.

Stock Valuation Concerns

There are concerns about increased customer concentration from more AMZN impacting the company's valuation multiple.

Astera Labs, Inc. Business Overview & Revenue Model

Company Description

Astera Labs, Inc. designs, manufactures, and sells semiconductor-based connectivity solutions for cloud and AI infrastructure. Its Intelligent Connectivity Platform is comprised of a portfolio of data, network, and memory connectivity products, which are built on a unifying software-defined architecture that enables customers to deploy and operate high performance cloud and AI infrastructure at scale. The company was incorporated in 2017 and is based in Santa Clara, California.

How the Company Makes Money

Astera Labs generates revenue through the sale of its semiconductor products and solutions, which are specifically designed to enhance data connectivity in complex computing environments. The company's key revenue streams include the sale of high-speed connectivity chips and modules that facilitate efficient data transfer and communication within data centers and cloud infrastructures. Additionally, Astera Labs may engage in strategic partnerships with major technology companies to integrate its solutions into larger systems, further driving sales and market penetration. The company's earnings are significantly influenced by the growing demand for advanced data processing and storage solutions in sectors such as AI, machine learning, and cloud computing.

Astera Labs, Inc. Financial Statement Overview

Summary

Astera Labs is experiencing rapid revenue growth and maintains a solid balance sheet with low leverage. However, profitability remains a concern with negative profit margins and return on equity. The positive shift in free cash flow is a favorable indicator, suggesting potential for improved financial health.

Income Statement

Astera Labs has shown a strong revenue growth of 242% from 2023 to 2024. Despite the impressive revenue growth, the company is still not profitable with negative net and EBIT margins, indicating ongoing operational challenges.

Balance Sheet

The balance sheet is robust with a high equity ratio of 91.5% and low debt, evidenced by a debt-to-equity ratio of 0.001. However, the negative ROE of -8.65% highlights inefficiencies in generating profits from shareholders' equity.

Cash Flow

Astera Labs has improved its cash flow situation significantly, with free cash flow turning positive in 2024. The operating cash flow to net income ratio is strong at -1.64, indicating effective cash management despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022
Income Statement
Total Revenue	605.55M	396.29M	115.79M	79.87M
Gross Profit	457.30M	302.70M	79.83M	58.68M
EBITDA	46.65M	-112.91M	-27.72M	-59.39M
Net Income	100.16M	-83.42M	-26.26M	-58.34M
Balance Sheet
Total Assets	1.27B	1.05B	196.29M	211.73M
Cash, Cash Equivalents and Short-Term Investments	1.07B	914.30M	149.31M	163.14M
Total Debt	32.31M	1.29M	2.93M	1.96M
Total Liabilities	135.69M	89.71M	38.87M	41.90M
Stockholders Equity	1.14B	964.80M	157.43M	169.84M
Cash Flow
Free Cash Flow	210.37M	102.43M	-15.48M	-39.77M
Operating Cash Flow	249.08M	136.68M	-12.72M	-35.90M
Investing Cash Flow	-518.48M	-757.57M	-17.77M	-90.59M
Financing Cash Flow	11.73M	655.84M	-502.00K	151.67M

Astera Labs, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 185.85
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALAB, the sentiment is Positive. The current price of 185.85 is above the 20-day moving average (MA) of 149.05, above the 50-day MA of 115.31, and above the 200-day MA of 97.40, indicating a bullish trend. The MACD of 23.24 indicates Negative momentum. The RSI at 75.34 is Negative, neither overbought nor oversold. The STOCH value of 85.98 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALAB.

Astera Labs, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SWKS	71 Outperform	$11.19B	30.03	6.61%	3.76%	-8.24%	-48.31%
ALAB	68 Neutral	$31.70B	325.88	10.11%	―	163.80%	―
ON	63 Neutral	$21.11B	47.67	5.72%	―	-17.93%	-75.83%
MTSI	58 Neutral	$9.34B	138.48	-5.96%	―	33.50%	-197.38%
SLAB	57 Neutral	$4.37B	―	-9.71%	―	29.66%	47.97%
Sector *	56 Neutral	$6.72B	7.77	-9.67%	6.24%	14.98%	-4.62%
SITM	55 Neutral	$5.90B	―	-9.17%	―	65.12%	15.46%

Astera Labs, Inc. Corporate Events

Astera Labs Holds 2025 Annual Stockholders Meeting

Astera Labs, Inc. conducted its 2025 Annual Stockholders Meeting on June 5, 2025, where 144,451,882 shares were voted. During the meeting, stockholders elected three Class I directors to the board and ratified PricewaterhouseCoopers LLP as the company’s independent auditor for the fiscal year ending December 31, 2025. These decisions are expected to influence the company’s governance and financial oversight positively.

The most recent analyst rating on (ALAB) stock is a Buy with a $60.00 price target. To see the full list of analyst forecasts on Astera Labs, Inc. stock, see the ALAB Stock Forecast page.