Allegro MicroSystems (NASDAQ:ALGM) Raised to Buy at Wall Street Zen

Key Points

• Wall Street Zen upgraded Allegro MicroSystems from “Hold” to “Buy,” while analysts overall maintain a “Moderate Buy” consensus with an average price target of $52.80.
• Allegro exceeded quarterly expectations, reporting $0.23 EPS and $259.24 million in revenue versus estimates of $0.21 and $251.44 million; revenue grew 27.5% year over year, and management issued quarterly EPS guidance of $0.23–$0.26.
• Shares opened at $41.50, well below the $52.80 consensus target, but analyst sentiment is mixed as some firms recently cut price targets. Insiders have sold 68,607 shares worth approximately $3.2 million over the past three months.

Allegro MicroSystems (NASDAQ:ALGM - Get Free Report) was upgraded by analysts at Wall Street Zen from a "hold" rating to a "buy" rating in a research note issued on Sunday.

Other equities analysts have also issued research reports about the stock. Barclays lowered shares of Allegro MicroSystems from an "overweight" rating to an "equal weight" rating and set a $48.00 target price on the stock. in a report on Monday, July 20th. UBS Group increased their target price on shares of Allegro MicroSystems from $52.00 to $55.00 and gave the stock a "buy" rating in a report on Friday, May 8th. TD Cowen reduced their price target on Allegro MicroSystems from $66.00 to $48.00 and set a "buy" rating on the stock in a report on Friday. Needham & Company LLC upped their price target on Allegro MicroSystems from $55.00 to $57.00 and gave the company a "buy" rating in a research report on Thursday. Finally, Wells Fargo & Company upped their price target on Allegro MicroSystems from $48.00 to $56.00 and gave the company an "overweight" rating in a research report on Friday, May 8th. Nine research analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of $52.80.

Allegro MicroSystems Stock Performance

Shares of ALGM opened at $41.50 on Friday. The company has a debt-to-equity ratio of 0.30, a current ratio of 3.70 and a quick ratio of 2.21. The company has a market cap of $7.73 billion, a PE ratio of 691.78 and a beta of 1.90. The firm has a 50-day moving average of $51.82 and a 200-day moving average of $42.58. Allegro MicroSystems has a one year low of $22.41 and a one year high of $71.77.

Allegro MicroSystems (NASDAQ:ALGM - Get Free Report) last announced its quarterly earnings data on Thursday, July 30th. The company reported $0.23 earnings per share for the quarter, topping the consensus estimate of $0.21 by $0.02. Allegro MicroSystems had a return on equity of 8.30% and a net margin of 1.50%.The company had revenue of $259.24 million during the quarter, compared to analyst estimates of $251.44 million. During the same quarter last year, the firm posted $0.09 EPS. The firm's revenue for the quarter was up 27.5% on a year-over-year basis. Allegro MicroSystems has set its Q2 2027 guidance at 0.230-0.260 EPS. As a group, equities analysts forecast that Allegro MicroSystems will post 0.77 earnings per share for the current year.

Insider Buying and Selling at Allegro MicroSystems

In other Allegro MicroSystems news, Director Susan D. Lynch sold 16,711 shares of Allegro MicroSystems stock in a transaction dated Thursday, May 14th. The shares were sold at an average price of $45.46, for a total value of $759,682.06. Following the completion of the transaction, the director directly owned 12,805 shares of the company's stock, valued at approximately $582,115.30. The trade was a 56.62% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Also, SVP Richard Madormo sold 5,000 shares of the company's stock in a transaction that occurred on Wednesday, June 3rd. The stock was sold at an average price of $52.72, for a total transaction of $263,600.00. Following the completion of the transaction, the senior vice president owned 69,687 shares in the company, valued at approximately $3,673,898.64. This represents a 6.69% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last three months, insiders have sold 68,607 shares of company stock valued at $3,213,714. Company insiders own 0.50% of the company's stock.

Institutional Investors Weigh In On Allegro MicroSystems

Several institutional investors and hedge funds have recently added to or reduced their stakes in ALGM. Invesco Ltd. increased its holdings in Allegro MicroSystems by 44.0% in the 4th quarter. Invesco Ltd. now owns 7,651,051 shares of the company's stock worth $201,835,000 after acquiring an additional 2,338,624 shares in the last quarter. State Street Corp boosted its position in shares of Allegro MicroSystems by 1.5% in the fourth quarter. State Street Corp now owns 5,359,488 shares of the company's stock worth $141,383,000 after purchasing an additional 78,203 shares during the period. Adage Capital Partners GP L.L.C. boosted its position in shares of Allegro MicroSystems by 77.8% in the fourth quarter. Adage Capital Partners GP L.L.C. now owns 2,803,944 shares of the company's stock worth $73,968,000 after purchasing an additional 1,227,317 shares during the period. Alliancebernstein L.P. increased its stake in shares of Allegro MicroSystems by 189.4% in the second quarter. Alliancebernstein L.P. now owns 2,759,872 shares of the company's stock worth $94,360,000 after purchasing an additional 1,806,183 shares in the last quarter. Finally, Geode Capital Management LLC increased its stake in shares of Allegro MicroSystems by 1.0% in the fourth quarter. Geode Capital Management LLC now owns 2,393,968 shares of the company's stock worth $63,165,000 after purchasing an additional 24,839 shares in the last quarter. Hedge funds and other institutional investors own 56.45% of the company's stock.

Trending Headlines about Allegro MicroSystems

Here are the key news stories impacting Allegro MicroSystems this week:

• Positive Sentiment: Allegro exceeded expectations with earnings of $0.23 per share versus the $0.21 consensus and revenue of $259.24 million versus $251.44 million. Revenue increased 27.5% year over year, while EPS rose substantially from $0.09 a year earlier. Allegro MicroSystems Beats Q1 Earnings and Revenue Estimates
• Positive Sentiment: Management issued second-quarter revenue guidance of $265 million to $275 million, above the $264.5 million consensus, and EPS guidance of $0.23 to $0.26, at or above expectations. Allegro MicroSystems Reports First Quarter 2027 Results
• Positive Sentiment: Record data-center sales, stronger bookings, expanding design wins and increased semiconductor content per system point to sustained AI infrastructure demand. Electrification and automation also provide additional growth opportunities. ALGM Q1 Earnings Call Highlights AI Data Center Growth
• Positive Sentiment: Needham raised its price target from $55 to $57 and maintained a Buy rating, implying substantial potential upside from the referenced $41.50 level.
• Neutral Sentiment: Despite the operating beat, Allegro reported a negative net margin of 1.67%, and the shares remain well below their 52-week high, suggesting investors may be weighing recovery potential against profitability and valuation risks.
• Negative Sentiment: Mizuho cut its price target from $67 to $58, although it retained an Outperform rating. TD Cowen also reduced its target from $66 to $48 while maintaining Buy. These reductions may limit enthusiasm by signaling more cautious assumptions despite the favorable results.

Allegro MicroSystems Company Profile

Allegro MicroSystems, Inc NASDAQ: ALGM is a leading designer and manufacturer of high-performance power and sensing integrated circuits. The company focuses on semiconductor solutions that enable precise motion control, energy-efficient power management and robust sensing in a wide range of applications. Allegro's product portfolio includes Hall-effect magnetic sensors, current and position sensing ICs, motor driver and controller devices, and power management components.

Allegro MicroSystems serves major automotive, industrial and consumer markets worldwide.

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