why Microchip Technology Incorporated [MCHP] is a Good Choice for Investors After New Price Target of $92.33


Microchip Technology Incorporated [NASDAQ: MCHP] surged by $3.94 during the normal trading session on Tuesday and reaching a high of $69.41 during the day while it closed the day at $68.25. The company report on May 9, 2022 that Microchip Technology Declares Quarterly Cash Dividend Increase to 27.6 Cents Per Share.

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(NASDAQ: MCHP) – Microchip Technology Incorporated, a leading provider of smart, connected, and secure embedded control solutions, today announced that its Board of Directors declared a quarterly cash dividend on its common stock of 27.6 cents per share. The dividend is payable on June 3, 2022, to stockholders of record on May 20, 2022. Microchip initiated quarterly cash dividend payments in the third quarter of fiscal year 2003 and has increased its dividend 70 times since its inception.

“Microchip’s financial performance in the March 2022 quarter was very strong, resulting in solid cash generation and significant debt reduction,” said Steve Sanghi, Executive Chair. “Today, our Board of Directors approved a sequential increase in our dividend of 9.1% to 27.6 cents per share, up from our February dividend of 25.3 cents per share. Also, our Board is now targeting to increase our dividend at least 9% sequentially, which is up from the 7% sequential increases communicated at our Investor and Analyst Day on November 8, 2021. These actions reflect confidence in the cash-generating capability of our business, as well as our ongoing commitment to returning capital to our stockholders.”.

Microchip Technology Incorporated stock has also gained 0.09% of its value over the past 7 days. However, MCHP stock has declined by -9.53% in the 3 months of the year. Over the past six months meanwhile, it has lost -18.91% and lost -21.61% year-on date.

The market cap for MCHP stock reached $38.25 billion, with 554.90 million shares outstanding and 544.88 million shares in the current float. Compared to the average trading volume of 5.25M shares, MCHP reached a trading volume of 8601759 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here’s what leading stock market gurus have to say about Microchip Technology Incorporated [MCHP]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for MCHP shares is $92.33 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on MCHP stock is a recommendation set at 2.10. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Goldman have made an estimate for Microchip Technology Incorporated shares, keeping their opinion on the stock as Neutral, with their previous recommendation back on March 28, 2022. While these analysts kept the previous recommendation, Wells Fargo dropped their target price from $85 to $80. The new note on the price target was released on February 04, 2022, representing the official price target for Microchip Technology Incorporated stock. Previously, the target price had yet another raise from $92 to $98, while UBS kept a Buy rating on MCHP stock. On February 04, 2022, analysts increased their price target for MCHP shares from 82 to 84.

The Average True Range (ATR) for Microchip Technology Incorporated is set at 3.04, with the Price to Sales ratio for MCHP stock in the period of the last 12 months amounting to 5.94. The Price to Book ratio for the last quarter was 6.52, with the Price to Cash per share for the same quarter was set at 0.56. Price to Free Cash Flow for MCHP in the course of the last twelve months was 21.69 with Quick ratio for the last quarter at 1.20.

MCHP stock trade performance evaluation

Microchip Technology Incorporated [MCHP] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 0.09. With this latest performance, MCHP shares gained by 2.91% in over the last four-week period, additionally sinking by -18.91% over the last 6 months – not to mention a drop of -6.19% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for MCHP stock in for the last two-week period is set at 49.75, with the RSI for the last a single of trading hit 51.62, and the three-weeks RSI is set at 48.61 for Microchip Technology Incorporated [MCHP]. The present Moving Average for the last 50 days of trading for this stock 70.10, while it was recorded at 67.78 for the last single week of trading, and 76.36 for the last 200 days.

Microchip Technology Incorporated [MCHP]: An insightful look at the core fundamentals

Operating Margin for any stock indicates how profitable investing would be, and Microchip Technology Incorporated [MCHP] shares currently have an operating margin of +18.38 and a Gross Margin at +44.99. Microchip Technology Incorporated’s Net Margin is presently recorded at +6.42.

Return on Total Capital for MCHP is now 6.75, given the latest momentum, and Return on Invested Capital for the company is 2.53. Return on Equity for this stock inclined to 6.40, with Return on Assets sitting at 2.06. When it comes to the capital structure of this company, Microchip Technology Incorporated [MCHP] has a Total Debt to Total Equity ratio set at 169.93. Additionally, MCHP Total Debt to Total Capital is recorded at 62.95, with Total Debt to Total Assets ending up at 55.04. Long-Term Debt to Equity for the company is recorded at 144.40, with the Long-Term Debt to Total Capital now at 53.49.

Reflecting on the efficiency of the workforce at the company, Microchip Technology Incorporated [MCHP] managed to generate an average of $17,918 per employee. Receivables Turnover for the company is 5.63 with a Total Asset Turnover recorded at a value of 0.32.Microchip Technology Incorporated’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.20 and a Current Ratio set at 1.80.

Earnings per share (EPS) analysis for Microchip Technology Incorporated [MCHP] stock

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for MCHP. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for Microchip Technology Incorporated go to 20.50%.

Microchip Technology Incorporated [MCHP]: Insider Ownership positions

There are presently around $32,482 million, or 90.70% of MCHP stock, in the hands of institutional investors. The top three institutional holders of MCHP stocks are: VANGUARD GROUP INC with ownership of 63,734,425, which is approximately 1.678% of the company’s market cap and around 2.00% of the total institutional ownership; BLACKROCK INC., holding 42,993,442 shares of the stock with an approximate value of $2.76 billion in MCHP stocks shares; and DODGE & COX, currently with $1.9 billion in MCHP stock with ownership of nearly -6.349% of the company’s market capitalization.

Positions in Microchip Technology Incorporated stocks held by institutional investors increased at the end of May and at the time of the May reporting period, where 508 institutional holders increased their position in Microchip Technology Incorporated [NASDAQ:MCHP] by around 37,011,966 shares. Additionally, 441 investors decreased positions by around 36,757,502 shares, while 175 investors held positions by with 431,310,094 shares. The mentioned changes placed institutional holdings at 505,079,562 shares, according to the latest SEC report filing. MCHP stock had 123 new institutional investments in for a total of 6,438,879 shares, while 94 institutional investors sold positions of 3,052,557 shares during the same period.