Semtech (NASDAQ:SMTC) Trading Down 7.8% - Here's Why

Key Points

• Semtech shares fell 7.8% to about $142.23, with trading volume roughly 82% below the average daily level.
• Analyst sentiment remains generally positive: Semtech has a “Moderate Buy” consensus rating and an average price target of $189.07, with several firms recently raising targets to $200–$225.
• The company exceeded quarterly expectations, reporting $0.51 EPS versus $0.45 expected and revenue of $291.02 million, up 15.9% year over year; however, it still posted a negative 3.05% net margin.

Semtech Corporation (NASDAQ:SMTC - Get Free Report)'s stock price was down 7.8% on Tuesday . The company traded as low as $141.65 and last traded at $142.2310. 482,298 shares were traded during trading, a decline of 82% from the average daily volume of 2,646,017 shares. The stock had previously closed at $154.22.

Wall Street Analysts Forecast Growth

Several research firms have recently weighed in on SMTC. Robert W. Baird lifted their target price on shares of Semtech from $110.00 to $225.00 and gave the stock an "outperform" rating in a research report on Wednesday, May 27th. Northland Securities cut Semtech from an "outperform" rating to a "market perform" rating in a research note on Tuesday, May 26th. B. Riley Financial increased their target price on shares of Semtech from $165.00 to $210.00 and gave the stock a "buy" rating in a research report on Wednesday, May 27th. Susquehanna boosted their price objective on shares of Semtech from $170.00 to $200.00 and gave the stock a "positive" rating in a research note on Wednesday, May 27th. Finally, UBS Group increased their target price on Semtech from $165.00 to $225.00 and gave the company a "buy" rating in a research note on Wednesday, May 27th. One analyst has rated the stock with a Strong Buy rating, thirteen have assigned a Buy rating, three have given a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat, Semtech presently has an average rating of "Moderate Buy" and an average price target of $189.07.

Semtech Price Performance

The company has a market cap of $12.69 billion, a P/E ratio of -351.42 and a beta of 2.35. The stock has a 50-day simple moving average of $140.52 and a 200 day simple moving average of $116.40. The company has a debt-to-equity ratio of 0.86, a quick ratio of 1.62 and a current ratio of 2.37.

Semtech (NASDAQ:SMTC - Get Free Report) last announced its quarterly earnings results on Tuesday, May 26th. The semiconductor company reported $0.51 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.45 by $0.06. The firm had revenue of $291.02 million for the quarter, compared to analyst estimates of $283.53 million. Semtech had a negative net margin of 3.05% and a positive return on equity of 18.31%. The business's revenue for the quarter was up 15.9% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.38 EPS. Semtech has set its Q2 2027 guidance at 0.590-0.630 EPS. On average, equities analysts expect that Semtech Corporation will post 1.81 EPS for the current year.

Insider Transactions at Semtech

In other news, EVP Jason Elliot Green sold 2,264 shares of Semtech stock in a transaction that occurred on Tuesday, July 7th. The shares were sold at an average price of $129.90, for a total value of $294,093.60. Following the completion of the transaction, the executive vice president owned 8,611 shares in the company, valued at approximately $1,118,568.90. The trade was a 20.82% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Mark Lin sold 970 shares of Semtech stock in a transaction on Wednesday, July 1st. The shares were sold at an average price of $150.41, for a total value of $145,897.70. Following the completion of the transaction, the chief financial officer owned 34,896 shares of the company's stock, valued at approximately $5,248,707.36. The trade was a 2.70% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders sold 22,234 shares of company stock valued at $3,203,091. 0.44% of the stock is owned by insiders.

Institutional Trading of Semtech

Hedge funds and other institutional investors have recently made changes to their positions in the business. FNY Investment Advisers LLC increased its holdings in shares of Semtech by 900.0% in the second quarter. FNY Investment Advisers LLC now owns 200 shares of the semiconductor company's stock valued at $32,000 after purchasing an additional 180 shares in the last quarter. Mitsubishi UFJ Asset Management Co. Ltd. acquired a new position in Semtech during the 2nd quarter worth $32,000. Banque Cantonale Vaudoise acquired a new position in Semtech during the 1st quarter worth $33,000. IFP Advisors Inc bought a new position in Semtech in the 4th quarter valued at $53,000. Finally, Allworth Financial LP bought a new position in Semtech in the 2nd quarter valued at $55,000.

About Semtech

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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