Microchip Technology Reports Q4 2024 Results, Maintains Resilience Amidst Challenges

By Don Francis, Editor
May 14, 2024 9:33 AM UTC
Microchip Technology Reports Q4 2024 Results, Maintains Resilience Amidst Challenges

Jefferies's Blayne Curtis assumed coverage on Microchip Technology (NASDAQ: MCHP) with a Strong Buy rating. The analyst also raised their price target by 15% from $100 to $115.

Curtis took coverage of the U.S. semiconductor names "with a bullish long-term view into a strong upcycle with duration." The analyst explained that the sector is "still early in the cycle" and that this particular cycle will be even stronger with AI.

Microchip Technology, a company that develops, manufactures, and sells smart embedded control solutions, recently reported its financial results for the fourth quarter of 2024 and the fiscal year 2024. In Q4 2024, the company reported earnings per share (EPS) of $0.57, which was in line with the Zacks Consensus Estimate but down 65.2% from the same period in the previous year. The revenue for the quarter was $1.326 billion, down 40.6% from Q4 2023. For the fiscal year 2024, Microchip Technology reported EPS of $4.92, down from the previous year, and revenue of $7.634 billion, also down from FY 2023.

Despite the challenges faced in FY 2024, Microchip Technology's President & CEO Ganesh Moorthy expressed confidence in the company's resilience and ability to navigate difficult business environments. Moorthy highlighted the company's commitment to its capital return program and its goal of returning 100% of adjusted free cash flow to shareholders by the current fiscal year-end. He also mentioned the company's focus on innovation and product portfolio expansion to maintain its competitive edge.

Following the analyst's rating on May 13, 2024, Microchip Technology's stock experienced some changes in its price targets and ratings from other analysts. Jefferies's Blayne Curtis lowered their price target on Applied Materials Inc by -2.3% and downgraded the stock from Strong Buy to Hold. The price target was also lowered for Interdigital Inc, Navitas Semiconductor Corp, and Arteris Inc, with downgrades to Hold for all three stocks. However, Advanced Micro Devices Inc maintained its Strong Buy rating with a slight decrease in the price target.

According to WallStreetZen, 78.6% of top-rated analysts currently rate Microchip Technology as a Strong Buy or Buy, while 21.4% see it as a Hold. No analysts recommend or strongly recommend selling the stock. The consensus forecast among analysts is that the company's upcoming year will deliver earnings per share (EPS) of $5.05, representing a 16.3% increase on a year-over-year basis.

Since Microchip Technology's latest quarterly report on May 6, 2024, the stock price has experienced a slight decline of 1.3%. However, on a year-over-year basis, the stock is up 22.8%. During this period, Microchip Technology is trailing the S&P 500, which has seen a 26.2% increase.

Jefferies analyst Blayne Curtis, who initiated coverage on Microchip Technology, is ranked in the top 4% of Wall Street analysts with an average return of 13.4% and a 50% win rate. Curtis specializes in the Technology and Communication Services sectors.

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