Microchip Technology (NASDAQ:MCHP) Sets New 1-Year Low - Here's Why

Microchip Technology Incorporated (NASDAQ:MCHP) reached a new 52-week low during trading last Friday, hitting a low of $49.51 before last trading at $49.62. A total of 637,425 shares changed hands, while the stock had previously closed at $50.79.

Recent Analyst Ratings

Several analysts have recently reassessed their ratings for Microchip Technology. KeyCorp reduced their target price from $70.00 to $60.00, noting an "overweight" rating for the company in a report issued on February 7th. On the other hand, StockNews.com downgraded Microchip Technology from a "hold" rating to a "sell" rating on February 10th. Meanwhile, Evercore ISI raised their target price from $65.00 to $71.00, classifying the stock under "outperform" on March 4th. Mizuho also increased their target price from $58.00 to $68.00 and attached an "outperform" rating in the same week. Finally, Needham & Company LLC enhanced their target price from $60.00 to $66.00, citing a "buy" rating. Currently, two analysts rate the stock as a sell, four as hold, thirteen as buy, and one gives a strong buy, resulting in a consensus rating of "Moderate Buy" and an average target price of $74.37.

Stock Status and Financial Overview

The company has a market capitalization of $26.75 billion, a price-to-earnings ratio of 88.46, and a beta of 1.52. The 50-day moving average stands at $55.83, while the 200-day moving average is $64.16. The company’s quick ratio is 1.23, the current ratio is 2.25, and the debt-to-equity ratio is 1.12.

In their latest earnings report released on February 6th, Microchip Technology reported earnings per share (EPS) of $0.13 for the quarter, which fell short of the consensus estimate of $0.28 by $0.15. The company showed a net margin of 6.49% and a return on equity of 12.62%. Analysts predict that Microchip Technology Incorporated will achieve an EPS of 1.03 for the current fiscal year.

Dividend Announcement

Microchip Technology recently declared a quarterly dividend, which was paid on March 7th. Stockholders on record as of February 24th received a dividend of $0.455. The ex-dividend date was also February 24th. This amounts to an annual dividend of $1.82, giving a dividend yield of 3.66%, although the dividend payout ratio is presently at 325.00%.

Insider Transactions

In other news regarding Microchip Technology, CFO James Eric Bjornholt sold 3,724 shares on February 25th, with the average selling price at $60.88, leading to a total transaction value of $226,717.12. Following this sale, the CFO owns 33,272 shares valued at about $2,025,599.36, reflecting a 10.07% decrease in ownership. Insider ownership currently stands at 2.10%.

Institutional Investment Activity

Company Overview

Microchip Technology Incorporated specializes in developing, manufacturing, and selling smart, connected, and secure embedded control solutions across the Americas, Europe, and Asia. The company’s product line includes various microcontrollers and microprocessors designed for numerous applications, including automotive, industrial, computing, communications, and security.

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