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Semtech
(NASDAQ:SMTC)
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Rating:61Neutral
Price Target:
$148.00
▲(17.53% Upside)
Action:Reiterated
Date:08/17/26
SMTC scores moderately overall, led by improved fundamentals (strong positive free cash flow and a healthier balance-sheet trend) and a highly constructive earnings call with strong growth and margin guidance. These positives are tempered by weak valuation support (negative P/E tied to net losses) and mixed technical signals (neutral momentum and price below the 50-day average).
Positive Factors
Data center and LoRa growth
Strong demand across data-center interconnect products and LoRa supports durable growth through design wins, expanding deployments, and recurring ecosystem adoption. Backlog and ramps across 800G, 1.6T, and LoRa provide a multi-quarter foundation.
Negative Factors
Ongoing net losses
Continued net losses limit retained earnings, shareholder returns, and the company’s ability to absorb execution setbacks. Although gross and operating margins are positive, the gap to sustainable bottom-line profitability remains a fundamental weakness.
Read all positive and negative factors
Positive Factors
Negative Factors
Data center and LoRa growth
Strong demand across data-center interconnect products and LoRa supports durable growth through design wins, expanding deployments, and recurring ecosystem adoption. Backlog and ramps across 800G, 1.6T, and LoRa provide a multi-quarter foundation.
Read all positive factors
Semtech (SMTC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$14.37B
Dividend YieldN/A
Average Volume (3M)3.64M
Price to Earnings (P/E)―
Beta (1Y)2.32
Revenue Growth14.22%
EPS Growth81.01%
CountryUS
Employees1,920
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)-0.37
Shares Outstanding93,151,170
10 Day Avg. Volume2,159,921
30 Day Avg. Volume3,642,698
Financial Highlights & Ratios
PEG Ratio2.22
Price to Book (P/B)13.05
Price to Sales (P/S)6.83
P/FCF Ratio44.92
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$205.25Price Target Upside63.00% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
EPS Forecast (FY)2.66
Revenue Forecast (FY)$1.37B
Semtech Business Overview & Revenue Model
Company Description
Semtech Corporation (SMTC) is a semiconductor, IoT systems, and cloud connectivity company that designs and supplies analog and mixed-signal semiconductors and connectivity solutions. The company is known for power management, signal integrity, pr...
How the Company Makes Money
Semtech makes money primarily by selling hardware and related solutions to device makers, OEMs, and industrial customers, supplemented by software/services and licensing/royalty-type economics tied to its connectivity ecosystem.
1) Semiconductor ...
Semtech Earnings Call Summary
Earnings Call Date:May 26, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Aug 25, 2026
Earnings Call Sentiment Positive
The call presents a strongly positive operational and financial story: record revenue, sizable year-over-year and sequential growth, strong adjusted EPS beat, improving margins and confident guidance for Q2 and FY27 driven by broad-based demand across data center (800G and 1.6T), robust LoRa momentum, strategic M&A (HIFU) and design wins. Notable near-term negatives include sequential declines in operating and free cash flow due to bonuses and acquisition outflows, a temporary margin compression in the signal integrity segment as a facility ramps, and supply/capacity constraints (notably GaN) that management is actively addressing. Overall, the highlights substantially outweigh the lowlights given strong backlog, guidance, and product traction.Positive Updates
Record Quarterly Revenue and Continued Growth
Reported record quarterly revenue of $291.0M in Q1 FY27, up 6% sequentially and up 16% year-over-year; marks the ninth consecutive quarter of net sales growth.
Negative Updates
Sequential Cash Flow Decline
Operating cash flow fell to $36.2M in Q1, down 41% sequentially (though up 30% YoY). Free cash flow was $28.0M, down 53% sequentially (up 7% YoY). Company cited FY26 annual bonus payments and acquisition cash outflows (net acquisition consideration of $29.2M) as drivers of sequential cash decline.
Read all updates
Q1-2027 Updates
Positive
Negative
Record Quarterly Revenue and Continued Growth
Reported record quarterly revenue of $291.0M in Q1 FY27, up 6% sequentially and up 16% year-over-year; marks the ninth consecutive quarter of net sales growth.
Read all positive updates
Company Guidance
Semtech guided Q2 FY2027 net sales of $328M ± $5M (midpoint +13% sequentially, +27% YoY) with data center revenue targeted to grow ~35% sequentially (≈85% YoY) and LoRa revenue expected >15% sequential growth; it forecast adjusted gross margin of 54% ±50 bps (midpoint +100 bps seq, +80 bps YoY) and total semiconductor products gross margin of 62.1% ±50 bps (midpoint +140 bps seq and YoY), adjusted net operating expenses of ≈ $105.2M ± $2M driving an adjusted operating margin of 21.9% midpoint (+150 bps seq, +310 bps YoY), adjusted EBITDA of $79.2M ± $2.3M (24.2% margin midpoint, +140 bps seq, +32 bps YoY), adjusted interest/other ≈ $0.5M, an adjusted normalized tax rate of 17%, and adjusted diluted EPS of $0.61 ± $0.02 (midpoint +20% sequential, +49% YoY) on ~97.7M weighted average shares.Semtech Financial Statement Overview
Summary
Income Statement
46
Neutral
Balance Sheet
58
Neutral
Cash Flow
72
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.09B | 1.05B | 909.29M | 868.76M | 756.53M | 740.86M |
| Gross Profit | 561.28M | 541.60M | 455.64M | 373.99M | 478.96M | 461.14M |
| EBITDA | 55.82M | 60.20M | -44.91M | -851.06M | 131.07M | 182.53M |
| Net Income | -33.23M | -40.40M | -161.90M | -1.09B | 61.38M | 125.66M |
Balance Sheet | ||||||
| Total Assets | 1.44B | 1.41B | 1.42B | 1.37B | 2.57B | 1.13B |
| Cash, Cash Equivalents and Short-Term Investments | 163.31M | 195.18M | 164.46M | 143.13M | 235.51M | 279.60M |
| Total Debt | 491.98M | 497.30M | 557.53M | 1.40B | 1.34B | 175.65M |
| Total Liabilities | 865.62M | 860.62M | 876.84M | 1.68B | 1.81B | 393.14M |
| Stockholders Equity | 573.32M | 549.72M | 542.43M | -307.43M | 755.85M | 737.58M |
Cash Flow | ||||||
| Free Cash Flow | 159.32M | 159.73M | 43.78M | -125.02M | 98.39M | 176.94M |
| Operating Cash Flow | 177.87M | 169.51M | 57.99M | -93.92M | 126.71M | 203.12M |
| Investing Cash Flow | -76.18M | -38.76M | -11.89M | -22.70M | -1.25B | -40.32M |
| Financing Cash Flow | -95.85M | -89.42M | -21.66M | 10.55M | 1.08B | -152.10M |
Semtech Technical Analysis
Positive
125.92
Price Trends
140.53
Negative
128.53
Positive
103.31
Positive
Market Momentum
1.56
Negative
50.61
Neutral
76.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMTC, the sentiment is Positive. The current price of 125.92 is below the 20-day moving average (MA) of 128.99, below the 50-day MA of 140.53, and above the 200-day MA of 103.31, indicating a neutral trend. The MACD of 1.56 indicates Negative momentum. The RSI at 50.61 is Neutral, neither overbought nor oversold. The STOCH value of 76.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SMTC.
Semtech Risk Analysis
Semtech disclosed 62 risk factors in its most recent earnings report. Semtech reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Semtech Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $17.23B | 130.54 | 6.50% | ― | 8.08% | -33.87% | |
70 Outperform | $6.01B | 14.19 | 20.35% | ― | 6.25% | 27.52% | |
62 Neutral | $22.54B | 1,414.04 | 1.27% | ― | 83.03% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $14.37B | -413.90 | -5.93% | ― | 14.22% | 81.01% | |
60 Neutral | $8.25B | 546.30 | 1.48% | ― | 24.22% | ― | |
57 Neutral | $7.32B | -185.60 | -3.59% | ― | 21.71% | 63.22% |
* Technology Sector Average
SMTC
Semtech
135.23
86.76
179.00%
CRUS
Cirrus Logic
116.88
4.06
3.60%
ONTO
Onto Innovation
315.42
209.49
197.76%
SLAB
Silicon Laboratories
219.00
85.24
63.73%
SITM
SiTime Corporation
680.06
458.46
206.89%
ALGM
Allegro MicroSystems
39.39
8.91
29.23%
Semtech Corporate Events
Business Operations and StrategyM&A Transactions
Semtech to Divest Cellular Module Business to Compal
Positive
Aug 13, 2026
On August 13, 2026, Semtech Corporation announced it had signed a definitive agreement to sell its cellular module business to Taiwan-based Compal Electronics, Inc. for $62 million in cash, pending customary adjustments and regulatory approvals. T...
Business Operations and StrategyPrivate Placements and Financing
Semtech Establishes New $360 Million Credit Facility
Positive
Jul 6, 2026
On July 6, 2026, Semtech Corporation entered into a new Credit Agreement establishing a $360 million revolving credit facility and an uncommitted incremental term loan option, replacing and fully repaying its prior JPMorgan-led facility from Septe...
Business Operations and StrategyFinancial Disclosures
Semtech Reports Record Q1 Fiscal 2027 Revenue Growth
Positive
May 26, 2026
On May 26, 2026, Semtech reported unaudited results for the first quarter of fiscal 2027, which ended April 26, 2026, posting record net sales of $291.0 million, up 6% sequentially and 16% year over year, with GAAP gross margin at 52.0% and operat...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.