Needham & Company Upgrades Microchip Technology (MCHP) to Strong Buy

Needham & Company upgraded Microchip Technology (NASDAQ: MCHP) from Buy to Strong Buy with a price target of $100.00.

Analyst Rajvindra Gill commented, "We are upgrading MCHP to a Strong Buy and establishing a $100 PT. When we upgraded MCHP to Buy on 1/14/16 (stock is up 81% vs SOX of 48% over same period), we were constructive on mgmt's ability to integrate Atmel and generate synergies. Throughout the year, MCHP has significantly increased its accretion targets to $0.90 vs $0.70 in FY18 and $1.00 vs $0.90 in FY19. Moreover, MCHP has raised its LT model to 60% GM, 24% OPEX and 36% OM. As such, we are modeling $5 of Non-GAAP EPS and FCF margin of ~30%. We believe MCHP deserves at least P/E 20x = $100 PT. From a strategic perspective, MCHP has gained market share in 8-Bit and 32-Bit MCUs, the attach rates of analog to MCUs has grown substantially and MCHP is well-positioned in IoT, Automotive, and Industrial. Analog specifically is on track to generate $1B in sales."

For an analyst ratings summary and ratings history on Microchip Technology click here. For more ratings news on Microchip Technology click here.

Shares of Microchip Technology closed at $69.62 yesterday.

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