Analyst Quinn Bolton from Needham maintained a Buy rating on Microchip (MCHP – Research Report) and keeping the price target at $66.00.
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Quinn Bolton’s rating is based on several positive indicators for Microchip’s future performance. The company reported results that aligned with expectations and provided a revenue forecast for the upcoming quarter that surpassed market predictions. This optimistic outlook is supported by the management’s assertion that the recent quarter marks the low point for revenue, with improvements in bookings and backlog signaling a positive trend.
Additionally, Microchip has not been directly affected by tariffs, and its strategic decision to relocate production outside of China and the United States mitigates potential risks. The company is also successfully implementing its strategic plan, which includes reducing capacity and inventory levels. As these efforts lead to better utilization and fewer inventory write-offs, there is potential for significant revenue growth, contributing to the Buy rating.
In another report released yesterday, Mizuho Securities also maintained a Buy rating on the stock with a $68.00 price target.