Allegro MicroSystems (NASDAQ:ALGM) Stock Price Down 5.8% Following Analyst Downgrade

Key Points

• Allegro MicroSystems shares fell 5.8% to about $39.11 after Mizuho cut its price target from $67 to $58, despite maintaining an “outperform” rating.
• Analyst sentiment remains broadly positive, with a consensus rating of “Moderate Buy” and an average price target of $52.80, although several firms recently reduced ratings or targets.
• The company reported stronger-than-expected quarterly results, including EPS of $0.23 versus $0.21 expected and revenue growth of 27.5% year over year; however, insiders sold 68,607 shares worth roughly $3.2 million over the past 90 days.

Shares of Allegro MicroSystems, Inc. (NASDAQ:ALGM - Get Free Report) dropped 5.8% on Monday after Mizuho lowered their price target on the stock from $67.00 to $58.00. Mizuho currently has an outperform rating on the stock. Allegro MicroSystems traded as low as $38.73 and last traded at $39.1110. 182,063 shares traded hands during mid-day trading, a decline of 93% from the average session volume of 2,636,917 shares. The stock had previously closed at $41.50.

A number of other brokerages have also commented on ALGM. TD Cowen cut their price objective on shares of Allegro MicroSystems from $66.00 to $48.00 and set a "buy" rating on the stock in a report on Friday. Wells Fargo & Company boosted their price target on Allegro MicroSystems from $48.00 to $56.00 and gave the stock an "overweight" rating in a research note on Friday, May 8th. Evercore restated an "outperform" rating and set a $53.00 price objective on shares of Allegro MicroSystems in a research note on Friday, May 8th. Wall Street Zen lowered Allegro MicroSystems from a "buy" rating to a "hold" rating in a research report on Saturday, July 25th. Finally, Barclays cut Allegro MicroSystems from an "overweight" rating to an "equal weight" rating and set a $48.00 target price for the company. in a research note on Monday, July 20th. Nine research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus price target of $52.80.

Insiders Place Their Bets

In other Allegro MicroSystems news, CEO Michael Doogue sold 30,089 shares of the stock in a transaction that occurred on Monday, May 11th. The stock was sold at an average price of $47.23, for a total transaction of $1,421,103.47. Following the transaction, the chief executive officer owned 252,797 shares of the company's stock, valued at $11,939,602.31. This trade represents a 10.64% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, CAO Roald Graham Webster sold 5,217 shares of Allegro MicroSystems stock in a transaction that occurred on Thursday, May 21st. The stock was sold at an average price of $44.88, for a total value of $234,138.96. Following the completion of the transaction, the chief accounting officer owned 13,106 shares of the company's stock, valued at approximately $588,197.28. The trade was a 28.47% decrease in their position. The SEC filing for this sale provides additional information. In the last ninety days, insiders sold 68,607 shares of company stock valued at $3,213,714. 0.50% of the stock is owned by company insiders.

Hedge Funds Weigh In On Allegro MicroSystems

Several large investors have recently added to or reduced their stakes in ALGM. Handelsbanken Fonder AB increased its stake in Allegro MicroSystems by 49.7% during the second quarter. Handelsbanken Fonder AB now owns 59,900 shares of the company's stock valued at $4,170,000 after purchasing an additional 19,900 shares during the last quarter. Fulton Bank N.A. bought a new position in shares of Allegro MicroSystems in the 2nd quarter worth about $322,000. Harbor Investment Advisory LLC acquired a new position in shares of Allegro MicroSystems in the 2nd quarter valued at about $72,000. Parallel Advisors LLC boosted its holdings in shares of Allegro MicroSystems by 42.8% in the 1st quarter. Parallel Advisors LLC now owns 1,008 shares of the company's stock valued at $32,000 after buying an additional 302 shares during the period. Finally, Bank of America Corp DE grew its position in shares of Allegro MicroSystems by 48.3% during the 1st quarter. Bank of America Corp DE now owns 855,453 shares of the company's stock valued at $26,972,000 after buying an additional 278,798 shares during the last quarter. 56.45% of the stock is currently owned by institutional investors.

Allegro MicroSystems Trading Down 4.6%

The firm has a market cap of $7.37 billion, a P/E ratio of 659.16, a P/E/G ratio of 1.10 and a beta of 1.90. The business's 50-day moving average is $51.82 and its two-hundred day moving average is $42.67. The company has a current ratio of 3.70, a quick ratio of 2.33 and a debt-to-equity ratio of 0.30.

Allegro MicroSystems (NASDAQ:ALGM - Get Free Report) last issued its earnings results on Thursday, July 30th. The company reported $0.23 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.21 by $0.02. Allegro MicroSystems had a net margin of 1.50% and a return on equity of 8.30%. The firm had revenue of $259.24 million for the quarter, compared to analysts' expectations of $251.44 million. During the same quarter last year, the company posted $0.09 earnings per share. Allegro MicroSystems's revenue 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, analysts expect that Allegro MicroSystems, Inc. will post 0.77 earnings per share for the current fiscal year.

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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