Microchip Technology (MCHP) Dips More Than Broader Markets: What You Should Know
Microchip Technology (MCHP) closed at $64.60 in the latest trading session, marking a -1.66% move from the prior day. This move lagged the S&P 500's daily loss of 1.13%. Elsewhere, the Dow lost 0.56%, while the tech-heavy Nasdaq added 0.16%.
Prior to today's trading, shares of the chipmaker had lost 8.37% over the past month. This has was narrower than the Computer and Technology sector's loss of 12.18% and lagged the S&P 500's loss of 7.59% in that time.
Microchip Technology will be looking to display strength as it nears its next earnings release. In that report, analysts expect Microchip Technology to post earnings of $1.44 per share. This would mark year-over-year growth of 34.58%. Meanwhile, our latest consensus estimate is calling for revenue of $2.06 billion, up 25.01% from the prior-year quarter.
MCHP's full-year Zacks Consensus Estimates are calling for earnings of $5.70 per share and revenue of $8.14 billion. These results would represent year-over-year changes of +23.64% and +19.4%, respectively.
Investors should also note any recent changes to analyst estimates for Microchip Technology. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Microchip Technology is holding a Zacks Rank of #3 (Hold) right now.
Investors should also note Microchip Technology's current valuation metrics, including its Forward P/E ratio of 11.52. Its industry sports an average Forward P/E of 14.64, so we one might conclude that Microchip Technology is trading at a discount comparatively.
Also, we should mention that MCHP has a PEG ratio of 0.79. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Semiconductor - Analog and Mixed was holding an average PEG ratio of 0.79 at yesterday's closing price.
The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 80, putting it in the top 32% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Microchip Technology Incorporated (MCHP) : Free Stock Analysis Report
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