Semtech (NASDAQ:SMTC) Shares Gap Up - Should You Buy?

Key Points

• Semtech Corporation shares opened significantly higher at $71.30, having closed the previous day at $68.17, and last traded at $73.24 with a trading volume of 450,229 shares.
• Analysts are bullish on Semtech, with thirteen analysts issuing a "Buy" rating and boosting price targets; Benchmark raised its target to $76.00 while Oppenheimer set it at $81.00.
• Insider transactions were reported, with Director Martin Burvill selling 3,500 shares, indicating a 33.62% decrease in his ownership stake in the company.

Shares of Semtech Corporation (NASDAQ:SMTC - Get Free Report) gapped up before the market opened on Tuesday . The stock had previously closed at $68.17, but opened at $71.30. Semtech shares last traded at $73.24, with a volume of 450,229 shares traded.

Analysts Set New Price Targets

Several analysts have issued reports on SMTC shares. Benchmark upped their price objective on Semtech from $68.00 to $76.00 and gave the company a "buy" rating in a research note on Tuesday, September 9th. Oppenheimer raised Semtech from a "market perform" rating to an "outperform" rating and set a $81.00 price target on the stock in a research report on Tuesday, September 30th. TD Cowen began coverage on shares of Semtech in a report on Wednesday, October 1st. They issued a "buy" rating and a $75.00 price objective for the company. Cowen initiated coverage on shares of Semtech in a report on Tuesday, September 30th. They set a "buy" rating on the stock. Finally, Piper Sandler raised their price target on shares of Semtech from $55.00 to $65.00 and gave the stock an "overweight" rating in a research report on Tuesday, August 26th. Fourteen research analysts have rated the stock with a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, Semtech presently has a consensus rating of "Moderate Buy" and an average target price of $65.36.

Semtech Stock Performance

The company has a debt-to-equity ratio of 0.94, a current ratio of 2.53 and a quick ratio of 1.78. The stock has a fifty day moving average price of $57.76 and a two-hundred day moving average price of $45.14. The company has a market cap of $6.27 billion, a P/E ratio of 302.13 and a beta of 2.01.

Insiders Place Their Bets

In related news, Director Martin Burvill sold 3,500 shares of the firm's stock in a transaction that occurred on Tuesday, September 16th. The shares were sold at an average price of $62.75, for a total transaction of $219,625.00. Following the completion of the sale, the director directly owned 6,909 shares in the company, valued at approximately $433,539.75. This trade represents a 33.62% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, CFO Mark Lin sold 971 shares of the company's stock in a transaction on Friday, October 3rd. The shares were sold at an average price of $72.83, for a total value of $70,717.93. Following the completion of the transaction, the chief financial officer directly owned 17,844 shares in the company, valued at $1,299,578.52. This represents a 5.16% decrease in their position. The disclosure for this sale can be found here. 0.48% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Semtech

Institutional investors and hedge funds have recently modified their holdings of the stock. Vanguard Group Inc. boosted its position in shares of Semtech by 1.4% in the 1st quarter. Vanguard Group Inc. now owns 11,702,315 shares of the semiconductor company's stock valued at $402,560,000 after purchasing an additional 159,770 shares during the period. Ameriprise Financial Inc. lifted its stake in Semtech by 10.3% during the second quarter. Ameriprise Financial Inc. now owns 7,112,097 shares of the semiconductor company's stock valued at $321,040,000 after buying an additional 666,456 shares in the last quarter. State Street Corp boosted its holdings in shares of Semtech by 1.5% in 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. Alliancebernstein L.P. increased its position in shares of Semtech by 9.8% in the second quarter. Alliancebernstein L.P. now owns 3,318,384 shares of the semiconductor company's stock worth $149,792,000 after acquiring an additional 294,990 shares in the last quarter. Finally, Disciplined Growth Investors Inc. MN raised its holdings in shares of Semtech by 4.2% during the second quarter. Disciplined Growth Investors Inc. MN now owns 2,894,536 shares of the semiconductor company's stock valued at $130,659,000 after acquiring an additional 115,921 shares during the period.

Semtech Company Profile

Semtech Corporation designs, develops, manufactures, and markets analog and mixed-signal semiconductor and advanced algorithms. It provides signal integrity products, including a portfolio of optical data communications and video transport products used in various infrastructure, and industrial applications; a portfolio of integrated circuits for data centers, enterprise networks, passive optical networks, wireless base station optical transceivers, and high-speed interface applications; and video products for broadcast applications, as well as video-over-IP technology for professional audio video applications.

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