Silicon Motion Technology (NASDAQ:SIMO) Trading Down 6.7% - What's Next?

Key Points

• Silicon Motion Technology shares fell 6.7% to about $240.93 in Monday’s midday trading, on volume 80% below the daily average.
• Despite the decline, analysts remain bullish: the stock has an average “Buy” rating and a consensus price target of $341.43, with several firms recently raising targets as high as $400.
• The company reported strong quarterly results, with EPS of $2.43 beating estimates and revenue rising 127% year over year to $451 million. However, insiders sold 4,000 shares worth roughly $1.24 million over the past 90 days.

Silicon Motion Technology Corporation (NASDAQ:SIMO - Get Free Report)'s stock price traded down 6.7% during mid-day trading on Monday . The company traded as low as $241.09 and last traded at $240.93. 177,003 shares were traded during mid-day trading, a decline of 80% from the average daily volume of 905,050 shares. The stock had previously closed at $258.36.

Wall Street Analysts Forecast Growth

SIMO has been the subject of a number of research analyst reports. Susquehanna increased their target price on shares of Silicon Motion Technology from $275.00 to $350.00 and gave the stock a "positive" rating in a research report on Friday, July 31st. Roth Capital restated a "buy" rating and set a $350.00 price objective on shares of Silicon Motion Technology in a research note on Thursday, July 30th. Wedbush raised their target price on Silicon Motion Technology from $230.00 to $400.00 and gave the company an "outperform" rating in a report on Monday, June 22nd. B. Riley Financial boosted their price target on Silicon Motion Technology from $312.00 to $350.00 and gave the stock a "buy" rating in a research report on Friday, July 31st. Finally, Craig Hallum reiterated a "buy" rating and set a $325.00 price objective on shares of Silicon Motion Technology in a research note on Friday, July 31st. One analyst has rated the stock with a Strong Buy rating and nine have issued a Buy rating to the company's stock. According to data from MarketBeat.com, the company has an average rating of "Buy" and an average price target of $341.43.

Silicon Motion Technology Stock Performance

The firm has a fifty day simple moving average of $281.06 and a 200-day simple moving average of $211.69. The company has a market capitalization of $8.32 billion, a PE ratio of 28.87, a P/E/G ratio of 0.45 and a beta of 1.71.

Silicon Motion Technology (NASDAQ:SIMO - Get Free Report) last released its earnings results on Wednesday, July 29th. The semiconductor producer reported $2.43 EPS for the quarter, beating the consensus estimate of $2.13 by $0.30. The company had revenue of $451.00 million during the quarter, compared to analysts' expectations of $403.41 million. Silicon Motion Technology had a return on equity of 32.04% and a net margin of 22.06%.The business's revenue was up 127.0% on a year-over-year basis. During the same period in the prior year, the business posted $0.69 EPS. As a group, research analysts anticipate that Silicon Motion Technology Corporation will post 10.78 EPS for the current fiscal year.

Insider Activity

In related news, Director Han-Ping Shieh sold 1,000 shares of Silicon Motion Technology stock in a transaction dated Thursday, June 18th. The stock was sold at an average price of $328.00, for a total value of $328,000.00. Following the completion of the transaction, the director directly owned 7,500 shares in the company, valued at approximately $2,460,000. This trade represents a 11.76% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, Director Kuan-Ming Lin sold 2,000 shares of the business's stock in a transaction dated Wednesday, June 17th. The shares were sold at an average price of $305.00, for a total value of $610,000.00. Following the completion of the sale, the director directly owned 8,500 shares of the company's stock, valued at approximately $2,592,500. This represents a 19.05% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 4,000 shares of company stock worth $1,239,250 in the last ninety days. Corporate insiders own 5.34% of the company's stock.

Hedge Funds Weigh In On Silicon Motion Technology

A number of hedge funds have recently added to or reduced their stakes in the business. Brown Brothers Harriman & Co. acquired a new stake in Silicon Motion Technology during the third quarter worth about $26,000. Cooper Investors PTY Ltd. acquired a new stake in shares of Silicon Motion Technology during the 2nd quarter worth approximately $34,000. Arax Advisory Partners lifted its holdings in shares of Silicon Motion Technology by 220.9% in the 4th quarter. Arax Advisory Partners now owns 446 shares of the semiconductor producer's stock worth $41,000 after purchasing an additional 307 shares during the last quarter. EverSource Wealth Advisors LLC lifted its holdings in shares of Silicon Motion Technology by 169.4% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 582 shares of the semiconductor producer's stock worth $44,000 after purchasing an additional 366 shares during the last quarter. Finally, Raymond James Financial Inc. acquired a new position in Silicon Motion Technology during the 2nd quarter valued at approximately $75,000. Institutional investors and hedge funds own 78.02% of the company's stock.

About Silicon Motion Technology

Silicon Motion Technology Corporation, together with its subsidiaries, designs, develops, and markets NAND flash controllers for solid-state storage devices. The company offers controllers for computing-grade solid state drives (SSDs), which are used in PCs and other client devices; enterprise-grade SSDs used in data centers; eMMC and UFS mobile embedded storage for use in smartphones and IoT devices; flash memory cards and flash drives for use in expandable storage; and specialized SSDs that are used in industrial, commercial, and automotive applications.

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