Zacks Investment Research Downgrades Microchip Technology (MCHP) to Hold

Microchip Technology (NASDAQ:MCHP) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a note issued to investors on Wednesday.

According to Zacks, “Microchip develops and manufacturers microcontrollers, memory and analog and interface products for embedded control systems. Microchip is benefiting from robust demand for 8-bit, 16-bit and 32-bit microcontrollers. We believe that Microchip's expanding product portfolio driven by new launches will continue to expand customer base. Moreover, acquisitions like that of Atmel are likely to expand its geographical presence, augment customer base, extend product portfolio and supplement operational excellence. However, increasing lead time due to manufacturing constraints can impact gross margins. Additionally, given its extensive geographical foothold the company is continuously adversely impacted by exchange rate volatility while competition remains headwind.”

MCHP has been the subject of a number of other research reports. Morgan Stanley restated an “overweight” rating and issued a $94.00 price target on shares of Microchip Technology in a research note on Wednesday, September 20th. Piper Jaffray Companies began coverage on shares of Microchip Technology in a research note on Monday, December 18th. They issued an “overweight” rating and a $100.00 price target for the company. Needham & Company LLC lifted their price target on shares of Microchip Technology from $120.00 to $130.00 and gave the stock a “strong-buy” rating in a research note on Tuesday, November 7th. ValuEngine lowered shares of Microchip Technology from a “buy” rating to a “hold” rating in a research note on Saturday, September 30th. Finally, Argus started coverage on shares of Microchip Technology in a research note on Friday, October 6th. They set a “buy” rating and a $106.00 target price for the company. Six analysts have rated the stock with a hold rating, thirteen have assigned a buy rating and one has issued a strong buy rating to the company’s stock. Microchip Technology currently has an average rating of “Buy” and an average target price of $101.18.

Shares of Microchip Technology (NASDAQ MCHP) traded up $0.22 during trading hours on Wednesday, hitting $91.99. 1,646,200 shares of the company were exchanged, compared to its average volume of 1,936,400. The company has a current ratio of 3.33, a quick ratio of 2.71 and a debt-to-equity ratio of 0.85. The company has a market capitalization of $21,410.00, a price-to-earnings ratio of 36.80, a PEG ratio of 1.47 and a beta of 1.00. Microchip Technology has a fifty-two week low of $62.21 and a fifty-two week high of $95.92.

Microchip Technology (NASDAQ:MCHP) last issued its quarterly earnings results on Monday, November 6th. The semiconductor company reported $1.41 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.27 by $0.14. The business had revenue of $1.01 billion during the quarter, compared to analyst estimates of $1 billion. Microchip Technology had a net margin of 16.23% and a return on equity of 35.48%. The business’s revenue was up 16.2% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $0.94 earnings per share. analysts forecast that Microchip Technology will post 5.12 earnings per share for the current fiscal year.

In other news, VP Stephen V. Drehobl sold 2,852 shares of the company’s stock in a transaction dated Wednesday, November 22nd. The shares were sold at an average price of $91.66, for a total transaction of $261,414.32. Following the completion of the transaction, the vice president now owns 15,767 shares in the company, valued at $1,445,203.22. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CFO James Eric Bjornholt sold 1,801 shares of the company’s stock in a transaction dated Wednesday, November 22nd. The stock was sold at an average price of $91.66, for a total transaction of $165,079.66. The disclosure for this sale can be found here. 2.13% of the stock is owned by insiders.

Institutional investors have recently added to or reduced their stakes in the company. Zions Bancorporation grew its position in shares of Microchip Technology by 215.5% during the third quarter. Zions Bancorporation now owns 1,224 shares of the semiconductor company’s stock worth $110,000 after acquiring an additional 836 shares during the last quarter. Amica Retiree Medical Trust acquired a new stake in Microchip Technology in the third quarter worth about $121,000. Valeo Financial Advisors LLC acquired a new stake in Microchip Technology in the third quarter worth about $146,000. Commonwealth Bank of Australia lifted its holdings in Microchip Technology by 1.4% in the second quarter. Commonwealth Bank of Australia now owns 2,124 shares of the semiconductor company’s stock worth $163,000 after purchasing an additional 29 shares during the period. Finally, Benjamin F. Edwards & Company Inc. lifted its holdings in Microchip Technology by 608.4% in the third quarter. Benjamin F. Edwards & Company Inc. now owns 2,104 shares of the semiconductor company’s stock worth $189,000 after purchasing an additional 1,807 shares during the period.

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About Microchip Technology

Microchip Technology Incorporated is engaged in developing, manufacturing and selling specialized semiconductor products used by its customers for a range of embedded control applications. The Company operates through two segments: semiconductor products and technology licensing. In the semiconductor products segment, the Company designs, develops, manufactures and markets microcontrollers, development tools and analog, interface, mixed signal and timing products.

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