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What Awaits Microchip (MCHP) This Earnings Season?
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Microchip Technology Incorporated (MCHP - Free Report) is scheduled to report third-quarter fiscal 2021 results on Feb 4.
The company anticipates fiscal third-quarter net sales in the range of $1.310 billion to $1.375 billion.
Notably, the Zacks Consensus Estimate for fiscal third-quarter revenues is currently pegged at $1.35 billion, suggesting an improvement of 4.8% from the year-ago quarter.
Non-GAAP earnings are projected between $1.51 and $1.63 per share.
In the past 30 days, the Zacks Consensus Estimate for fiscal third-quarter earnings has been revised upward by 1 cent to $1.58 per share, indicates growth of 19.7% from the prior-year reported figure.
Microchip Technology Incorporated Price and EPS Surprise
Microchip’s fiscal third-quarter results are likely to reflect gains from demand recovery across automotive and industrial end markets on easing of lockdowns and relaxation in shelter-in-place guidelines.
Notably, to capitalize on this demand, the company introduced CryptoAutomotive security IC, the TrustAnchor100 (TA100) device, during the quarter under review, with an aim to aid OEMs and module suppliers to simplify automotive network security, generate cost savings and reduce time to market.
Further, solid momentum of Microsemi’s solutions in Data Center, and Communications end-markets might have benefited the to-be-reported quarter’s performance.
Besides, improving demand across office equipment and communication infrastructures courtesy of requirement for cloud computing solutions and booming PC market amid the coronavirus crisis-led work-from-home wave also bodes well.
Moreover, incremental adoption of microcontrollers, primarily the latest Bluetooth 5.0 dual-mode audio solutions, may have favored Microchip’s fiscal third-quarter performance. Robust demand for 8-bit, 16-bit and 32-bit microcontrollers might have contributed to the to-be-reported quarter’s performance.
The company is also anticipated to have witnessed strength in medical end market, courtesy of growth in demand for hospital equipment like ventilators, oxygen monitors, respirators, ultrasound machines and other COVID-19 related items. This might have contributed to the fiscal third-quarter performance.
Likewise, incremental adoption of the company’s META-DX1 suite of Ethernet products may have driven microcontrollers’ fiscal third-quarter performance.
Also, gains from design wins for Microchip’s latest PolarFire imaging solutions, primarily for 4K high resolutions, might get reflected in FPGA’s (or Field Programmable Gate Array) fiscal third-quarter revenues.
Further, the incremental adoption of new RT PolarFire FPGA that supports high-performance requirements of complex space applications may have contributed to the to-be-reported quarter’s performance.
Additionally, Microchip’s fiscal third-quarter results are likely to reflect synergies from acquisitions including Microsemi, Micrel and Atmel.
However, broad-based coronavirus crisis-induced macroeconomic weakness and headwinds pertaining to Huawei ban are likely to have weighed on the fiscal third-quarter performance.
Also, increasing expenses on product development amid stiff competition from peers including Cirrus Logic and Silicon Laboratories are likely to have limited margin expansion in the fiscal third quarter.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Microchip this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Microchip has an Earnings ESP of +1.14% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some other stocks worth considering as our proven model shows that these too have the right combination of elements to beat on earnings this season.
Qorvo (QRVO - Free Report) presently has an Earnings ESP of +0.78% and a Zacks Rank #2.
Synaptics Incorporated (SYNA - Free Report) has an Earnings ESP of +0.42% and a Zacks Rank of 2 at present.
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What Awaits Microchip (MCHP) This Earnings Season?
Microchip Technology Incorporated (MCHP - Free Report) is scheduled to report third-quarter fiscal 2021 results on Feb 4.
The company anticipates fiscal third-quarter net sales in the range of $1.310 billion to $1.375 billion.
Notably, the Zacks Consensus Estimate for fiscal third-quarter revenues is currently pegged at $1.35 billion, suggesting an improvement of 4.8% from the year-ago quarter.
Non-GAAP earnings are projected between $1.51 and $1.63 per share.
In the past 30 days, the Zacks Consensus Estimate for fiscal third-quarter earnings has been revised upward by 1 cent to $1.58 per share, indicates growth of 19.7% from the prior-year reported figure.
Microchip Technology Incorporated Price and EPS Surprise
Microchip Technology Incorporated price-eps-surprise | Microchip Technology Incorporated Quote
Factors to Note
Microchip’s fiscal third-quarter results are likely to reflect gains from demand recovery across automotive and industrial end markets on easing of lockdowns and relaxation in shelter-in-place guidelines.
Notably, to capitalize on this demand, the company introduced CryptoAutomotive security IC, the TrustAnchor100 (TA100) device, during the quarter under review, with an aim to aid OEMs and module suppliers to simplify automotive network security, generate cost savings and reduce time to market.
Further, solid momentum of Microsemi’s solutions in Data Center, and Communications end-markets might have benefited the to-be-reported quarter’s performance.
Besides, improving demand across office equipment and communication infrastructures courtesy of requirement for cloud computing solutions and booming PC market amid the coronavirus crisis-led work-from-home wave also bodes well.
Moreover, incremental adoption of microcontrollers, primarily the latest Bluetooth 5.0 dual-mode audio solutions, may have favored Microchip’s fiscal third-quarter performance. Robust demand for 8-bit, 16-bit and 32-bit microcontrollers might have contributed to the to-be-reported quarter’s performance.
The company is also anticipated to have witnessed strength in medical end market, courtesy of growth in demand for hospital equipment like ventilators, oxygen monitors, respirators, ultrasound machines and other COVID-19 related items. This might have contributed to the fiscal third-quarter performance.
Likewise, incremental adoption of the company’s META-DX1 suite of Ethernet products may have driven microcontrollers’ fiscal third-quarter performance.
Also, gains from design wins for Microchip’s latest PolarFire imaging solutions, primarily for 4K high resolutions, might get reflected in FPGA’s (or Field Programmable Gate Array) fiscal third-quarter revenues.
Further, the incremental adoption of new RT PolarFire FPGA that supports high-performance requirements of complex space applications may have contributed to the to-be-reported quarter’s performance.
Additionally, Microchip’s fiscal third-quarter results are likely to reflect synergies from acquisitions including Microsemi, Micrel and Atmel.
However, broad-based coronavirus crisis-induced macroeconomic weakness and headwinds pertaining to Huawei ban are likely to have weighed on the fiscal third-quarter performance.
Also, increasing expenses on product development amid stiff competition from peers including Cirrus Logic and Silicon Laboratories are likely to have limited margin expansion in the fiscal third quarter.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Microchip this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Microchip has an Earnings ESP of +1.14% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Here are some other stocks worth considering as our proven model shows that these too have the right combination of elements to beat on earnings this season.
CDW Corporation (CDW - Free Report) has an Earnings ESP of +6.74% and a Zacks Rank of 2 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Qorvo (QRVO - Free Report) presently has an Earnings ESP of +0.78% and a Zacks Rank #2.
Synaptics Incorporated (SYNA - Free Report) has an Earnings ESP of +0.42% and a Zacks Rank of 2 at present.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
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