Rambus has formed a cup-with-handle base that has a buy point of 63.15. On its weekly chart on IBD MarketSurge, the stock also shows a cup base with a higher buy point of 69.15. Both bases are early-stage ones and can net higher gains after a strong breakout. The Relative Strength Rating has climbed to 87 from 23 a year ago. Rambus is Thursday's selection for IBD 50 Growth Stocks To Watch.
Earnings have grown over the past six quarters, ranging from 35% to 108%. Sales growth has been steady over the past five quarters, expanding 4% to 41%.
Artificial Intelligence News And AI Stocks To Watch
First-quarter results on April 28 showed that growth accelerated. Earnings increased 76% from the prior year to 60 cents per share. Sales grew 41% to $166.7 million. Wall Street projections are high for future earnings. For the full year, analysts polled by FactSet expect earnings per share of $2.46, representing 37% growth from 2024, when the company reported EPS of $1.80. For 2026, Wall Street projects profit rising 15% to $2.83 per share.
Rambus makes chips used in data centers and for artificial intelligence tasks. Its connectivity and security chips are also used in Internet of Things applications and the automotive industry, including autonomous vehicles. Its Composite Rating is an outstanding 96, while the Earnings Per Share Rating is at a perfect 99. According to IBD Stock Checkup, Rambus stock ranks fourth in the fabless chip group. The group holds 86th place among 197 industry groups in the Investor's Business Daily database.
Rambus Stock: Fund Ownership Sits At a Strong 61%
The relative strength line has been ticking higher as the stock carves its handle and shows that shares are outperforming the benchmark S&P 500.
Mutual funds own 61% of outstanding shares. Although the Accumulation/Distribution Rating of C+ indicates that funds have not been buyers in the recent 13 weeks, the Up/Down Volume Ratio of 1.2 suggests that demand for the stock has been running strong over the past 50 trading days. In the IBD mutual fund index, the Alger Small Cap Growth Fund (ALSCX) and the Lord Abbett Developing Growth Fund (LAGWX) hold shares of Rambus stock.
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