In a report released today, Quinn Bolton from Needham maintained a Buy rating on Microchip, with a price target of $75.00.
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Quinn Bolton has given his Buy rating due to a combination of factors influencing Microchip’s positive outlook. The company announced that its third-quarter revenue and earnings per share are expected to reach the upper end of previous guidance, driven by improved bookings and a strong backlog. Notably, the December quarter is projected to see a 1% quarter-over-quarter revenue growth, with earnings per share anticipated at $0.40.
Additionally, demand in sectors such as aerospace, defense, and data centers remains strong, while there has been a recent uptick in demand within the communications, automotive, and industrial sectors. Although inventory charges are expected to normalize by the first quarter of fiscal year 2027, underutilization charges may persist longer. Furthermore, gross margins are projected to exceed 60% in the fourth quarter of fiscal year 2026. These factors collectively support a positive outlook for Microchip, leading to an increased price target of $75.
Bolton covers the Technology sector, focusing on stocks such as Microchip, Super Micro Computer, and Monolithic Power. According to TipRanks, Bolton has an average return of 28.7% and a 54.51% success rate on recommended stocks.
In another report released yesterday, Citi also reiterated a Buy rating on the stock with a $80.00 price target.