Allegro MicroSystems (NASDAQ:ALGM) Shares Gap Down - Time to Sell?

Key Points

• Shares of Allegro MicroSystems gapped down before trading, falling from a $51.37 close to a $43.90 open and trading around $47.30 on roughly 967,000 shares, indicating near‑term selling pressure.
• The company beat Q4 estimates (EPS $0.17 vs. $0.16; revenue $243.2M vs. $235.9M), with revenue up ~26% YoY and fiscal‑year sales rising ~23% to $890M, and management set Q1 guidance roughly in line with consensus (EPS $0.190–$0.230; revenue $245–$255M).
• Despite strong top‑line growth, Allegro reported a negative net margin (-1.57%) and a negative P/E, leaving investors to weigh margin/valuation risk even as analysts hold a "Moderate Buy" consensus with an average target of $45.

Shares of Allegro MicroSystems, Inc. (NASDAQ:ALGM - Get Free Report) gapped down prior to trading on Thursday . The stock had previously closed at $51.37, but opened at $43.90. Allegro MicroSystems shares last traded at $47.3020, with a volume of 967,292 shares trading hands.

More Allegro MicroSystems News

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

• Positive Sentiment: Q4 results beat estimates: Allegro reported $0.17 EPS vs. consensus $0.16 and revenue of $243.2M vs. $235.9M, showing a clear revenue and EPS beat that supports near-term momentum. Allegro MicroSystems, Inc. (ALGM) Q4 Earnings and Revenues Surpass Estimates
• Positive Sentiment: Strong revenue growth and FY scale: Q4 sales were up ~26% YoY and fiscal‑year 2026 sales rose ~23% to $890M — evidence of demand traction in its automotive and industrial end markets. Allegro MicroSystems Reports Fourth Quarter and Fiscal Year 2026 Results
• Positive Sentiment: Guidance roughly in line: Management set Q1 FY27 EPS guidance of $0.190–$0.230 and revenue guidance of $245–$255M, which overlaps consensus (EPS consensus ~$0.190; revenue consensus ~$246.6M) — guidance that reduces downside surprise risk. Earnings / Guidance Details and Conference Call
• Neutral Sentiment: Analyst stance and coverage: Consensus analyst sentiment is modestly constructive (consensus “Moderate Buy”), which supports interest but doesn’t imply strong upgrade-driven buying. Analyst Consensus: Moderate Buy
• Neutral Sentiment: Valuation context: Recent sector rally and rising optimism have prompted valuation re-checks; investors are balancing growth versus cyclical/valuation risk for semiconductor suppliers. Valuation Check After Sector Rally
• Negative Sentiment: Profitability and margin concerns: Despite revenue growth, Allegro reported a negative net margin (-1.57%) and modest ROE, which can make investors sensitive to any signals that margin recovery will be slow or that costs/one‑offs pressured results. Earnings / Margin Details

Analyst Upgrades and Downgrades

ALGM has been the subject of several recent analyst reports. UBS Group raised their target price on shares of Allegro MicroSystems from $40.00 to $44.00 and gave the company a "buy" rating in a research note on Friday, January 30th. Needham & Company LLC raised their price objective on Allegro MicroSystems from $41.00 to $45.00 and gave the company a "buy" rating in a research report on Thursday, February 19th. Barclays raised their price objective on Allegro MicroSystems from $35.00 to $46.00 and gave the company an "overweight" rating in a research report on Friday, January 30th. Wall Street Zen raised Allegro MicroSystems from a "hold" rating to a "buy" rating in a research report on Sunday, January 18th. Finally, Jefferies Financial Group reaffirmed a "buy" rating and issued a $45.00 price objective on shares of Allegro MicroSystems in a research report on Thursday, February 19th. Ten equities research analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, Allegro MicroSystems has an average rating of "Moderate Buy" and an average price target of $45.00.

Allegro MicroSystems Stock Performance

The company has a market cap of $8.87 billion, a P/E ratio of -598.34 and a beta of 2.02. The company has a quick ratio of 2.39, a current ratio of 3.65 and a debt-to-equity ratio of 0.30. The stock has a 50 day moving average price of $36.25 and a two-hundred day moving average price of $32.67.

Allegro MicroSystems (NASDAQ:ALGM - Get Free Report) last announced its earnings results on Thursday, May 7th. The company reported $0.17 earnings per share for the quarter, topping analysts' consensus estimates of $0.16 by $0.01. The company had revenue of $243.19 million for the quarter, compared to analyst estimates of $235.94 million. Allegro MicroSystems had a positive return on equity of 4.35% and a negative net margin of 1.57%.The firm's quarterly revenue was up 26.1% compared to the same quarter last year. During the same quarter last year, the company earned $0.06 earnings per share. Allegro MicroSystems has set its Q1 2027 guidance at 0.190-0.230 EPS. On average, research analysts predict that Allegro MicroSystems, Inc. will post 0.27 earnings per share for the current fiscal year.

Institutional Investors Weigh In On Allegro MicroSystems

A number of large investors have recently added to or reduced their stakes in ALGM. Royal Bank of Canada grew its position in Allegro MicroSystems by 70.0% during the first quarter. Royal Bank of Canada now owns 117,923 shares of the company's stock worth $2,964,000 after buying an additional 48,554 shares in the last quarter. AQR Capital Management LLC bought a new stake in Allegro MicroSystems during the first quarter worth $325,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC lifted its stake in Allegro MicroSystems by 31.8% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 354,610 shares of the company's stock worth $8,911,000 after purchasing an additional 85,607 shares during the last quarter. Prudential Financial Inc. lifted its stake in Allegro MicroSystems by 24.0% during the second quarter. Prudential Financial Inc. now owns 15,684 shares of the company's stock worth $536,000 after purchasing an additional 3,040 shares during the last quarter. Finally, First Trust Advisors LP lifted its stake in Allegro MicroSystems by 5.4% during the second quarter. First Trust Advisors LP now owns 576,478 shares of the company's stock worth $19,710,000 after purchasing an additional 29,531 shares during the last quarter. Institutional investors and hedge funds own 56.45% of the company's stock.

About Allegro MicroSystems

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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