B. Riley Cuts Q3 EPS Estimates for Microchip Technology

On January 24, 2025, analysts from B. Riley reduced their earnings per share (EPS) estimates for Microchip Technology Incorporated (NASDAQ:MCHP) for the third quarter of 2025. Analyst C. Ellis now projects that the semiconductor company will achieve an EPS of $0.19 for this quarter, a downgrade from the prior estimate of $0.23. B. Riley maintains a “Buy” rating for Microchip Technology with a price target set at $85.00. Currently, the consensus among analysts for the company's full-year earnings is $1.31 per share.

B. Riley has also provided projections for future earnings, estimating Q4 2025 earnings at $0.22 EPS, full-year earnings for 2025 at $1.27 EPS, and for 2026, they anticipate Q1 earnings at $0.33 EPS, Q2 at $0.43 EPS, Q3 at $0.47 EPS, Q4 at $0.54 EPS, and full-year earnings at $1.76 EPS.

Additional Analyst Ratings and Price Target Adjustments

Other equity research analysts have also weighed in on Microchip Technology’s stock. For instance, TD Cowen lowered its target price from $80.00 to $70.00 and maintained a “hold” rating as reported on November 6. Meanwhile, Goldman Sachs Group cut its price target from $72.00 to $63.00 and established a “neutral” rating on January 10. Piper Sandler reduced its forecast from $100.00 to $85.00 with an “overweight” rating on the same day. Evercore ISI adjusted its price target downwards from $101.00 to $95.00 while still maintaining an “outperform” rating. Lastly, Rosenblatt Securities reaffirmed its “buy” rating with a price target of $90.00. Overall, one analyst has rated the stock as a sell, five have classified it as a hold, and thirteen have assigned a buy rating. According to information from MarketBeat, Microchip Technology has an average rating of “Moderate Buy” with a consensus target price of $84.00.

Microchip Technology's Stock Performance

As of Monday, shares of MCHP opened at $56.39. The company currently holds a current ratio of 0.88, a quick ratio of 0.48, and a debt-to-equity ratio of 0.71. Throughout the past twelve months, Microchip Technology's stock has seen a low of $54.47 and a peak of $100.57, giving it a market capitalization of $30.28 billion. Its price-to-earnings ratio stands at 39.43, with a beta of 1.52. The company’s 50-day simple moving average is $60.28, while the 200-day simple moving average is $72.50.

Quarterly Earnings Report

On November 5, Microchip Technology announced its recent quarterly earnings, reporting $0.46 EPS for the quarter. This performance was better than the expected EPS of $0.43. The company generated revenue of $1.16 billion during that quarter, exceeding analyst predictions of $1.15 billion. Microchip's net margin was recorded at 14.22%, with a return on equity of 19.47%. This was a significant decrease in revenue, down 48.4% in comparison to the same quarter last year, where the company had reported $1.54 EPS.

Dividend Increase

Recently, Microchip Technology declared an increase in its quarterly dividend, which was paid on December 6. Shareholders registered on November 22 received a dividend of $0.455 per share, translating to an annualized dividend of $1.82 and a yield of 3.23%. This marks an increase from the previous quarterly dividend of $0.45. The ex-dividend date was the same as the record date. Despite this increase, the company’s dividend payout ratio now stands at 127.27%.

Institutional Investments

There has been notable activity from institutional investors regarding Microchip Technology shares. Pallas Capital Advisors LLC invested in the company during the fourth quarter, acquiring a stake valued at approximately $5.92 million. Quadrature Capital Ltd also entered during the third quarter with an investment of about $3.31 million. A significant increase was seen with Benjamin Edwards Inc., which raised its holdings by 5,185.4% during the third quarter, now owning 9,408 shares amounting to $755,000. Empowered Funds LLC expanded its position by 25.7% as well, holding 96,163 shares worth $7.72 million after adding 19,663 shares. Furthermore, Assenagon Asset Management S.A. made a large purchase of 2,857,654 shares, valued at $163.89 million. Currently, institutional investors hold approximately 91.51% of Microchip Technology's stock.

Company Overview

Microchip Technology Incorporated focuses on developing, manufacturing, and selling embedded control solutions that are smart, connected, and secure, operating in regions across the Americas, Europe, and Asia. The company provides a wide range of products, including general-purpose 8-bit, 16-bit, and 32-bit mixed-signal microcontrollers, along with specialized microcontrollers tailored for automotive, industrial, and communication applications.

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