Description
Microchip had a solid fourth quarter that surpassed Wall Street expectations in terms of revenues as well as earnings. The net sales of this quarter were 4.6% up sequentially. The company has managed a gross margin of 68.1%. Microchip has also increased the raw materials inventory to protect the internal manufacturing chains. It is now investing in building inventory for long-lived, high-margin products. The company has already paid almost 80% of the debt and considerably reduced its financial leverage which is a good sign. In terms of new launches, Microchip launched the MIC69303RT, a 3A Low-Dropout Voltage Regulator in the previous quarter. It is to be seen how well it is able to contribute to the company’s top-line. We give the company a ‘Hold’ rating with a revised target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
⦁ Disclosures
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