Semtech (NASDAQ:SMTC) Sets New 1-Year High - Still a Buy?

Key Points

• Semtech hit a new 52-week high near $112.43 (stock up ~5.7%) and draws mostly bullish analyst coverage—14 Buys, 1 Hold, 1 Sell—with Baird and Oppenheimer raising targets to $110 while the MarketBeat average target remains $95.71.
• The company slightly beat the quarter on EPS ($0.44 vs. $0.43) and revenue rose 9.3% YoY to $274.4M, but profitability is mixed with a negative net margin (-3.86%) and a negative P/E (-253.12).
• Insiders have been selling recently (CEO and CFO among sellers; 45,884 shares sold in the past 90 days), even as large institutions like Vanguard, Ameriprise and Capital Research increased their stakes significantly.

Semtech Corporation (NASDAQ:SMTC - Get Free Report) reached a new 52-week high during trading on Friday . The company traded as high as $111.90 and last traded at $112.43, with a volume of 1130387 shares changing hands. The stock had previously closed at $105.34.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently commented on the company. Robert W. Baird upped their price objective on Semtech from $88.00 to $110.00 and gave the company an "outperform" rating in a report on Tuesday, March 17th. TD Cowen reiterated a "buy" rating on shares of Semtech in a report on Tuesday, February 24th. Wall Street Zen downgraded Semtech from a "strong-buy" rating to a "buy" rating in a report on Monday, January 26th. Weiss Ratings downgraded Semtech from a "hold (c-)" rating to a "sell (d-)" rating in a report on Tuesday, March 24th. Finally, Oppenheimer increased their price target on Semtech from $100.00 to $110.00 and gave the stock an "outperform" rating in a report on Tuesday, March 17th. Fourteen analysts have rated the stock with a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and an average target price of $95.71.

Semtech Stock Up 5.7%

The firm has a fifty day simple moving average of $86.80 and a 200-day simple moving average of $78.50. The company has a market capitalization of $10.37 billion, a P/E ratio of -253.12 and a beta of 2.06. The company has a quick ratio of 1.66, a current ratio of 2.37 and a debt-to-equity ratio of 0.89.

Semtech (NASDAQ:SMTC - Get Free Report) last announced its quarterly earnings results on Monday, March 16th. The semiconductor company reported $0.44 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.43 by $0.01. Semtech had a positive return on equity of 18.09% and a negative net margin of 3.86%.The company had revenue of $274.40 million during the quarter, compared to the consensus estimate of $273.14 million. During the same period in the prior year, the company earned $0.40 earnings per share. The company's revenue for the quarter was up 9.3% compared to the same quarter last year. On average, equities research analysts expect that Semtech Corporation will post 1.6 EPS for the current fiscal year.

Insider Activity at Semtech

In other news, CEO Hong Q. Hou sold 2,000 shares of the company's stock in a transaction dated Friday, April 10th. The stock was sold at an average price of $90.11, for a total transaction of $180,220.00. Following the completion of the transaction, the chief executive officer directly owned 73,228 shares of the company's stock, valued at $6,598,575.08. This represents a 2.66% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Mark Lin sold 9,186 shares of the company's stock in a transaction dated Tuesday, March 24th. The stock was sold at an average price of $75.05, for a total value of $689,409.30. Following the transaction, the chief financial officer directly owned 32,710 shares of the company's stock, valued at $2,454,885.50. This represents a 21.93% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold 45,884 shares of company stock valued at $3,867,175 over the last ninety days. Company insiders own 0.48% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently modified their holdings of the company. Vanguard Group Inc. boosted its position in shares of Semtech by 2.6% during the fourth quarter. Vanguard Group Inc. now owns 11,858,352 shares of the semiconductor company's stock worth $873,842,000 after buying an additional 298,987 shares during the period. Ameriprise Financial Inc. boosted its position in shares of Semtech by 3.7% during the third quarter. Ameriprise Financial Inc. now owns 7,373,744 shares of the semiconductor company's stock worth $526,861,000 after buying an additional 261,647 shares during the period. Capital Research Global Investors boosted its position in shares of Semtech by 13.9% during the third quarter. Capital Research Global Investors now owns 4,691,676 shares of the semiconductor company's stock worth $335,220,000 after buying an additional 571,372 shares during the period. State Street Corp boosted its position in shares of Semtech by 1.5% during the second quarter. State Street Corp now owns 4,037,107 shares of the semiconductor company's stock worth $182,235,000 after buying an additional 60,788 shares during the period. Finally, Whale Rock Capital Management LLC boosted its position in Semtech by 11.3% during the fourth quarter. Whale Rock Capital Management LLC now owns 3,901,469 shares of the semiconductor company's stock valued at $287,499,000 after purchasing an additional 396,504 shares during the last quarter.

Semtech Company Profile

Semtech Corporation is a leading supplier of high-performance analog and mixed-signal semiconductors and advanced algorithms. The company's products address a broad range of applications in the Internet of Things (IoT), data center and telecom, industrial, home automation, automotive, and aerospace markets. Semtech's portfolio includes power management, signal integrity, protection devices, wireless and sensing technologies that enable smarter, more connected systems worldwide.

A core offering from Semtech is its LoRa® technology, a low-power, long-range wireless communication platform that has become a de facto standard for global IoT deployments.

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