Microchip Technology (NASDAQ:MCHP) Shares Gap Down Following Analyst Downgrade

Key Points

• Microchip Technology's shares gapped down to $61.58 after TD Cowen lowered their price target from $75 to $60, maintaining a hold rating on the stock.
• The company reported a quarterly earnings per share of $0.27, beating estimates, despite a 13.3% year-over-year revenue decline.
• Microchip Technology declared a quarterly dividend of $0.455 per share, representing an annualized yield of 2.9%.

Microchip Technology Incorporated (NASDAQ:MCHP - Get Free Report)'s share price gapped down prior to trading on Friday after TD Cowen lowered their price target on the stock from $75.00 to $60.00. The stock had previously closed at $66.22, but opened at $61.58. TD Cowen currently has a hold rating on the stock. Microchip Technology shares last traded at $62.76, with a volume of 5,277,331 shares traded.

A number of other research firms also recently commented on MCHP. The Goldman Sachs Group began coverage on shares of Microchip Technology in a research note on Thursday, July 10th. They set a "buy" rating and a $88.00 price objective for the company. Mizuho upped their price objective on shares of Microchip Technology from $78.00 to $85.00 and gave the company an "outperform" rating in a research note on Tuesday, July 8th. Truist Financial upped their price objective on shares of Microchip Technology from $52.00 to $64.00 and gave the company a "hold" rating in a research note on Wednesday, June 18th. Morgan Stanley upped their price objective on shares of Microchip Technology from $39.00 to $50.00 and gave the company an "equal weight" rating in a research note on Friday, May 9th. Finally, Cantor Fitzgerald began coverage on shares of Microchip Technology in a research note on Wednesday, June 18th. They set a "neutral" rating and a $70.00 price objective for the company. Six research analysts have rated the stock with a hold rating, thirteen have given a buy rating and one has assigned a strong buy rating to the company. Based on data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $76.58.

Insider Buying and Selling at Microchip Technology

In related news, CFO James Eric Bjornholt sold 2,015 shares of the company's stock in a transaction dated Friday, May 23rd. The shares were sold at an average price of $55.78, for a total value of $112,396.70. Following the completion of the sale, the chief financial officer owned 34,313 shares of the company's stock, valued at $1,913,979.14. This represents a 5.55% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. Also, Director Karlton D. Johnson sold 494 shares of the company's stock in a transaction dated Tuesday, May 20th. The stock was sold at an average price of $60.69, for a total transaction of $29,980.86. Following the completion of the sale, the director directly owned 3,468 shares of the company's stock, valued at $210,472.92. The trade was a 12.47% decrease in their position. The disclosure for this sale can be found here. Insiders own 1.94% of the company's stock.

Institutional Investors Weigh In On Microchip Technology

A number of institutional investors and hedge funds have recently bought and sold shares of the business. MTM Investment Management LLC acquired a new stake in Microchip Technology in the 2nd quarter valued at about $84,000. Citizens Financial Group Inc. RI raised its holdings in Microchip Technology by 56.3% during the 2nd quarter. Citizens Financial Group Inc. RI now owns 8,427 shares of the semiconductor company's stock worth $593,000 after buying an additional 3,036 shares during the period. Avantax Advisory Services Inc. raised its holdings in Microchip Technology by 122.3% during the 2nd quarter. Avantax Advisory Services Inc. now owns 167,989 shares of the semiconductor company's stock worth $11,821,000 after buying an additional 92,412 shares during the period. Intech Investment Management LLC raised its holdings in Microchip Technology by 48.4% during the 2nd quarter. Intech Investment Management LLC now owns 19,361 shares of the semiconductor company's stock worth $1,362,000 after buying an additional 6,317 shares during the period. Finally, SG Capital Management LLC acquired a new stake in Microchip Technology during the 2nd quarter worth about $8,937,000. 91.51% of the stock is owned by institutional investors and hedge funds.

Microchip Technology Trading Down 6.6%

The company has a fifty day simple moving average of $69.65 and a 200-day simple moving average of $58.10. The company has a current ratio of 2.59, a quick ratio of 1.47 and a debt-to-equity ratio of 0.80. The stock has a market cap of $33.39 billion, a price-to-earnings ratio of -181.97, a P/E/G ratio of 1.79 and a beta of 1.55.

Microchip Technology (NASDAQ:MCHP - Get Free Report) last posted its quarterly earnings data on Thursday, August 7th. The semiconductor company reported $0.27 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.24 by $0.03. The firm had revenue of $1.08 billion for the quarter, compared to the consensus estimate of $1.05 billion. Microchip Technology had a positive return on equity of 6.33% and a negative net margin of 3.50%. The business's revenue for the quarter was down 13.3% compared to the same quarter last year. During the same quarter in the previous year, the company earned $0.53 EPS. On average, research analysts forecast that Microchip Technology Incorporated will post 1.03 earnings per share for the current fiscal year.

Microchip Technology Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, September 5th. Stockholders of record on Friday, August 22nd will be issued a $0.455 dividend. The ex-dividend date is Friday, August 22nd. This represents a $1.82 dividend on an annualized basis and a dividend yield of 2.9%. Microchip Technology's dividend payout ratio is currently -18,200.00%.

About Microchip Technology

Microchip Technology Incorporated engages in the development, manufacture, and sale of smart, connected, and secure embedded control solutions in the Americas, Europe, and Asia. The company offers general purpose 8-bit, 16-bit, and 32-bit mixed-signal microcontrollers; 32-bit embedded mixed-signal microprocessors; and specialized microcontrollers for automotive, industrial, computing, communications, lighting, power supplies, motor control, human machine interface, security, wired connectivity, and wireless connectivity applications.