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Microchip Technology (MCHP) Is Down Than The Broader Market: What You Need To Know

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Microchip Technology (MCHP) closed at $64.60 in the latest trading session, down -1.66% from the previous day. The move lagged behind his 1.13% daily loss in the S&P 500. Elsewhere, the Dow fell 0.56% while the tech stock Nasdaq rose 0.16%.

Prior to today’s trading, the chipmaker’s shares had fallen 8.37% over the past month. This is smaller than his 12.18% loss in the computer and technology sector and lags behind his 7.59% loss in the S&P 500 at the time.

Microchip Technology is looking to show some strength as it approaches its next earnings release. In that report, the analyst expects Microchip Technology to post earnings of $1.44 per share for him. This sees him grow by 34.58% year-on-year. Meanwhile, the latest consensus forecast calls for him to earn $2.06 billion, up 25.01% from the same period last year.

MCHP’s full-year Zacks consensus forecast calls for earnings of $5.70 per share and earnings of $8.14 billion. These results represent +23.64% and +19.4% year-over-year changes, respectively.

Investors should also be aware of Microchip Technology’s recent changes to analyst forecasts. These recent revisions tend to reflect the evolving nature of near-term business trends. With this in mind, the positive estimate revision can be seen as an optimistic sign about the company’s business prospects.

Based on our research, we believe these revisions to estimates are directly related to inventory movements closer to the team. To benefit from this, we have developed a proprietary model, Zacks Rank, that takes into account the changes in these estimates and provides a practical rating system.

The Zacks Rank system from No. 1 (strong buy) to No. 5 (strong sell) has been proven by an external audit, with the top stock earning an average +25% annual return since 1988. EPS estimates have remained stagnant within the past month. Microchip Technology currently holds the #3 Zacks Rank (hold).

Investors should also keep an eye on Microchip Technology’s current valuation metrics, including a forward P/E of 11.52. With an average forward P/E of 14.64 for the industry, we can conclude that microchip technology is trading relatively cheaply.

Also, MCHP has a PEG ratio of 0.79. This common metric is similar to the well-known P/E ratio, except that the PEG ratio also takes into account the company’s expected earnings growth. The Semiconductor – Analog and Mixed held an average PEG ratio of 0.79 at yesterday’s close.

Semiconductors – analog and mixed industries are part of the computer and technology sector. The Zacks Industry Rank for this group is 80, placing it in the top 32% of all industries over 250.

Zacks Industry Rank measures the strength of an industry group by measuring the average Zacks Rank of individual stocks within the group. Our research shows that industries rated in the top 50% are two to one times better than those in the bottom half.

Stay tuned to to follow all these stock dynamics indicators and more in your future trading sessions.

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