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Semtech Corporation
SMTC Details
Semtech Corporation (NASDAQ: SMTC) provides analog as well as mixed-signal semiconductor products to original equipment manufacturers and distributors.
Financial Results
Outlook
For Q1 FY 2025, SMTC is expecting net sales of ~$200 Mn (+/- $5 Mn) and gross margin of 49.5% (+/- 100 bps). It is expecting operating income of $20.5 Mn (+/- $3.0 Mn).
Key Risks
The cyclical nature of the industry, Risks relating to production operations and services, etc. are some of the risks SMTC is exposed to.
Fundamental Valuation
EV/Sales Based Relative Valuation
Stock Recommendation
Over the last one month, the stock has given a return of 36.4%. The stock has made a 52-week low and high of USD 37.08 and USD 13.13, respectively. The company’s performance is exposed to the risks related to the global slowdown as well as geopolitical tensions.
Also, unfavorable or uncertain conditions in the 5G infrastructure market could result in fluctuations in the rate of revenue growth or financial results. The company is subject to export restrictions as well as laws affecting trade and investments. This could limit the ability to sell to certain customers.
Hence, a ‘Sell’ rating has been provided on the stock at the closing price of $37.62 per share, up by 1.54% as on 30th April 2024
Technical Overview:
SMTC Daily Technical Chart, Data Source: REFINITIV
Markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
Note 1: Past performance is neither an indicator nor a guarantee of future performance.
Note 2: The reference date for share price chart and stock valuation is based on April 30, 2024. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.
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