Semiconductor company Microchip Technology Inc. (NASDAQ: MCHP) has reported better-than-expected results for the fiscal fourth quarter ended March 31, 2022.
Following the upbeat earnings, shares of the company rose 2.6% to close at $66 in Monday’s extended trading session.
Revenue & Earnings
Microchip reported quarterly net sales of $1.84 billion, up 25.7% year-over-year. Further, the figure topped the consensus estimate of $1.82 billion.
Earnings per share (EPS) for the quarter stood at $1.35, up 45.2% from the same quarter last year. Moreover, the figure surpassed the consensus estimate of $1.25 per share.
The company’s operating income for the quarter witnessed a year-over-year rise of 78.4% to $549.5 million.
Further, its liquidity position improved year-over-year. The cash and short-term investments balance rose from $282 million in the same quarter last year to $319.4 million.
Outlook
For the first quarter of Fiscal Year 2023, the company forecasts net sales between $1.918 and $1.992 billion. The consensus estimate for the same is pegged at $1.86 billion.
Further, the company expects earnings in the range of $1.32 to $1.36 per share against the consensus estimate of $1.28 per share.
Stock Rating
The Wall Street community is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on seven Buys and four Holds. MCHP’s average price target of $90.40 implies that the stock has upside potential of 40.6% from current levels. Shares have declined 10.3% over the past year.
Insider Trading Activity
TipRanks’ Insider Trading Activity tool shows that confidence in MCHP is currently Very Positive based on informative transactions by four insiders over the past three months. Corporate Insiders have bought shares worth $5.3 million over this period.
Conclusion
Microchip’s strong quarterly results and its strong liquidity position give the company a strong footing to grow its operations.
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