Citi analyst Christopher Danely has reiterated their bullish stance on MCHP stock, giving a Buy rating today.
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Christopher Danely has given his Buy rating due to a combination of factors that highlight Microchip’s potential for strong future growth. Despite the company’s recent mixed results, with guidance slightly below consensus but above seasonal expectations, Danely sees an opportunity for significant earnings per share (EPS) growth in the coming years. Microchip’s EPS is projected to grow by 195% in 2026, which is more than any other company in its sector.
Microchip’s performance in the microcontroller business, which constitutes a significant portion of its sales, has been a positive factor, contributing to better-than-expected gross margins. Although the company’s guidance for the next quarter is conservative, it still surpasses seasonal trends, indicating resilience and potential for future growth. Danely remains confident in the eventual recovery of the analog market, which, coupled with Microchip’s strong bookings and low inventory levels, suggests substantial upside potential. As a result, he maintains a Buy rating, albeit with a slightly reduced price target, reflecting the current market conditions.
In another report released today, Stifel Nicolaus also maintained a Buy rating on the stock with a $75.00 price target.