Allegro MicroSystems (NASDAQ:ALGM) Shares Gap Up - Still a Buy?

Key Points

• Allegro MicroSystems shares jumped from a $36.38 close to a $38.15 open and last traded at $39.15, near its 50-day moving average of $38.44.
• Analysts remain generally optimistic, with a consensus “Moderate Buy” rating and an average price target of $53.17, though ratings range from Strong Buy to Sell.
• The company exceeded quarterly expectations, reporting $0.23 in EPS and $259.24 million in revenue, up 27.5% year over year; however, its very high P/E ratio of 645.81 highlights a demanding valuation.

Allegro MicroSystems, Inc. (NASDAQ:ALGM - Get Free Report) shares gapped up prior to trading on Friday. The stock had previously closed at $36.38, but opened at $38.15. Allegro MicroSystems shares last traded at $39.15, with a volume of 448,744 shares traded.

Wall Street Analyst Weigh In

A number of research analysts recently commented on the company. Needham & Company LLC boosted their price target on Allegro MicroSystems from $55.00 to $57.00 and gave the stock a "buy" rating in a report on Thursday, July 30th. Royal Bank Of Canada started coverage on shares of Allegro MicroSystems in a report on Friday. They issued an "outperform" rating and a $50.00 price target on the stock. Mizuho decreased their price target on shares of Allegro MicroSystems from $67.00 to $58.00 and set an "outperform" rating on the stock in a research note on Friday, July 31st. Barclays downgraded shares of Allegro MicroSystems from an "overweight" rating to an "equal weight" rating and set a $48.00 price objective for the company. in a report on Monday, July 20th. Finally, Wall Street Zen raised Allegro MicroSystems from a "hold" rating to a "buy" rating in a report on Sunday, August 2nd. One analyst has rated the stock with a Strong Buy rating, ten have given a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, the company has an average rating of "Moderate Buy" and an average price target of $53.17.

Allegro MicroSystems Price Performance

The firm's 50-day moving average is $38.44 and its two-hundred day moving average is $43.13. The company has a market cap of $7.22 billion, a P/E ratio of 645.81, a PEG ratio of 1.14 and a beta of 1.99. The company has a debt-to-equity ratio of 0.30, a current ratio of 3.70 and a quick ratio of 2.33.

Allegro MicroSystems (NASDAQ:ALGM - Get Free Report) last released its quarterly earnings data on Thursday, July 30th. The company reported $0.23 EPS for the quarter, beating the consensus estimate of $0.21 by $0.02. Allegro MicroSystems had a net margin of 1.50% and a return on equity of 8.30%. The business had revenue of $259.24 million during the quarter, compared to analyst estimates of $251.44 million. During the same quarter last year, the business earned $0.09 earnings per share. Allegro MicroSystems's quarterly revenue was up 27.5% compared to the same quarter last year. Allegro MicroSystems has set its Q2 2027 guidance at 0.230-0.260 EPS. Analysts anticipate that Allegro MicroSystems, Inc. will post 0.65 earnings per share for the current year.

Insider Activity

In related news, SVP Erin Hagen sold 2,285 shares of the stock in a transaction dated Monday, August 10th. The shares were sold at an average price of $44.39, for a total value of $101,431.15. Following the completion of the transaction, the senior vice president owned 31,052 shares of the company's stock, valued at approximately $1,378,398.28. This trade represents a 6.85% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Corporate insiders own 0.50% of the company's stock.

Institutional Investors Weigh In On Allegro MicroSystems

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Transamerica Financial Advisors LLC purchased a new position in shares of Allegro MicroSystems in the 2nd quarter worth approximately $27,000. Rakuten Securities Inc. purchased a new stake in Allegro MicroSystems during the 2nd quarter valued at $31,000. Parallel Advisors LLC raised its holdings in Allegro MicroSystems by 42.8% during 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. Continuum Advisory LLC bought a new stake in Allegro MicroSystems in the second quarter worth $35,000. Finally, First Bancorp Inc ME purchased a new position in Allegro MicroSystems during the second quarter worth $49,000. 56.45% of the stock is currently owned by hedge funds and other institutional investors.

Allegro MicroSystems Company Profile

Allegro MicroSystems, Inc NASDAQ: ALGM develops and manufactures semiconductor solutions that enable motion, power management and energy efficiency in automotive and industrial applications. The company specializes in sensor integrated circuits and power semiconductor devices designed to monitor, control and improve the performance of electronic systems.

Its product portfolio includes magnetic sensors for detecting position, speed, current and angle, as well as power management integrated circuits, motor drivers, LED driver ICs and other application-specific solutions.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.