There’s always a second chance in the stock market. Investors who missed out on Apple and Amazon in the early 2000s had access to picks like Tesla and Nvidia in the 2010s. Even in this past decade, stocks like Palantir minted new millionaires.
Micron (NASDAQ: MU) and Sandisk (NASDAQ: SNDK) have built substantial wealth for early investors over the past year. Opportunities like these will exist in the 2030s and beyond, but there’s one growth stock that looks attractive right now and is riding the same tailwinds as the memory chipmakers. Here’s why Penguin Solutions (NASDAQ: PENG) is worth monitoring.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
This memory play is growing faster than people realize
The front-line number, 68% year-over-year revenue growth in the company’s fiscal 2026 fourth quarter, is impressive. However, the metrics are actually more compelling if you look at the company’s key growth segment.
Penguin Solutions reports three segments each quarter: advanced computing, integrated memory, and optimized LED. Integrated memory is the most important segment, since it includes key memory products for AI data centers. Its DRAM modules are the top seller, while Penguin Solutions’ CXL memory modules are surging in demand as a recognized solution to the memory wall bottleneck.
CXL enables GPUs to access a memory pool. Without this setup, a single AI chip can crash or slow down an AI model if it runs out of memory. Since CXL solves this problem and Penguin Solutions is one of the few companies already delivering this technology, it has a massive tailwind.
These trends helped Penguin Solutions’ integrated memory segment grow by 158% year over year. It grew much faster than the other two segments and made up 60% of overall sales. As the memory segment grows and accounts for a larger share of total revenue, Penguin Solutions’ revenue and net income growth rates should continue to accelerate.
Penguin Solutions is winning more customers
While consumer-facing companies like Walmart must consistently win over many customers, Penguin Solutions only needs a handful to generate substantial revenue growth. That’s why it was such a big deal when the company won six new AI infrastructure data center customers in the fourth quarter of fiscal 2026.
That customer profile included four neocloud providers, which must aggressively scale out data centers to deliver for customers. The data center scale-out will increase demand for Penguin Solutions’ memory products, especially its CXL products that address the memory wall.
