Allegro MicroSystems (NASDAQ:ALGM) Releases Quarterly Earnings Results, Beats Estimates By $0.02 EPS

Allegro MicroSystems (NASDAQ:ALGM) announced its quarterly earnings results on Thursday. The company reported $0.23 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.21 by $0.02, FiscalAI reports. The company had revenue of $259.24 million during the quarter, compared to the consensus estimate of $251.44 million. Allegro MicroSystems had a negative net margin of 1.67% and a positive return on equity of 6.09%. The company’s revenue for the quarter was up 27.5% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.09 earnings per share. Allegro MicroSystems updated its Q2 2027 guidance to 0.230-0.260 EPS.

Here are the key takeaways from Allegro MicroSystems’ conference call:

• Q1 revenue reached $259 million, up 27% year over year and above the high end of guidance, while non-GAAP EPS rose 156% to $0.23. This marked the sixth consecutive quarter of sequential sales growth.
• Data center sales grew 32% sequentially to a record 17% of total revenue, with current sensors representing 22% of data center sales. Management expects fiscal 2027 data center revenue to more than double, supported by rising AI-server power demands and additional opportunities in isolated gate drivers.
• Automotive revenue increased 15% year over year, while bookings and design wins each rose 30%. Allegro cited continued content and share gains in electrified vehicles, ADAS, electromechanical braking, steer-by-wire, and TMR-based sensing.
• Robotics and automation are expected to contribute 3%–4% of fiscal 2027 sales, with new current-sensor and inductive-position-sensor wins at Chinese and North American humanoid robotics customers. Management estimates potential Allegro content above $150 per humanoid by 2030.
• Q2 revenue is expected at $265 million–$275 million, implying 26% year-over-year growth, while EPS is forecast at $0.23–$0.26. Gross margin is guided to 50.75%–51.75% as operating expenses rise for R&D investments and variable compensation, although pricing actions and manufacturing efficiencies are expected to support margins later in the fiscal year.

Allegro MicroSystems Price Performance

Allegro MicroSystems stock traded down $0.76 during trading hours on Thursday, hitting $41.45. 6,152,679 shares of the company traded hands, compared to its average volume of 2,646,623. Allegro MicroSystems has a 1-year low of $22.41 and a 1-year high of $71.77. The firm has a market cap of $7.72 billion, a P/E ratio of -460.50 and a beta of 1.90. The firm’s 50-day simple moving average is $51.97 and its two-hundred day simple moving average is $42.52. The company has a quick ratio of 2.21, a current ratio of 3.45 and a debt-to-equity ratio of 0.30.

Analyst Ratings Changes

Several brokerages recently weighed in on ALGM. Evercore reiterated an “outperform” rating and issued a $53.00 price objective on shares of Allegro MicroSystems in a research report on Friday, May 8th. Mizuho lifted their price target on Allegro MicroSystems from $54.00 to $67.00 and gave the company an “outperform” rating in a report on Monday, June 29th. UBS Group boosted their price objective on Allegro MicroSystems from $52.00 to $55.00 and gave the stock a “buy” rating in a research report on Friday, May 8th. Needham & Company LLC raised their target price on Allegro MicroSystems from $55.00 to $57.00 and gave the company a “buy” rating in a research report on Thursday. Finally, Jefferies Financial Group reaffirmed a “buy” rating and set a $62.00 target price on shares of Allegro MicroSystems in a research note on Thursday, May 7th. Nine equities research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has issued a Sell rating to the company’s stock. Based on data from MarketBeat.com, Allegro MicroSystems presently has an average rating of “Moderate Buy” and an average target price of $55.40.

Key Headlines Impacting Allegro MicroSystems

Here are the key news stories impacting Allegro MicroSystems this week:

• Positive Sentiment: Quarterly results exceeded expectations. Allegro reported fiscal first-quarter 2027 EPS of $0.23, versus the $0.21 analyst consensus and $0.09 a year earlier. Revenue increased 27.5% year over year to $259.24 million, topping estimates of $251.44 million. Allegro MicroSystems Reports First Quarter 2027 Results
• Positive Sentiment: Forward guidance was slightly above expectations. Allegro forecast fiscal second-quarter 2027 revenue of $265 million to $275 million, compared with the $264.5 million consensus estimate. Its EPS outlook of $0.23 to $0.26 brackets the $0.23 consensus estimate. Allegro MicroSystems Earnings Report
• Positive Sentiment: Needham raised its price target and maintained a bullish view. The firm increased its target from $55 to $57 and assigned a “Buy” rating, implying substantial upside from the referenced trading level. Benzinga Analyst Update
• Neutral Sentiment: The market response has been mixed. ALGM initially ticked up following the results but subsequently traded lower on heavier-than-average volume, indicating that the earnings beat and guidance were not enough to sustain the early gains.
• Negative Sentiment: Profitability remains a concern. Although Allegro beat on adjusted earnings, its reported net margin remained negative at 1.67%. Investors may therefore be looking for continued improvement in margins and bottom-line earnings before assigning a higher valuation.

Insider Buying and Selling

In related news, Director Susan D. Lynch sold 16,711 shares of Allegro MicroSystems stock in a transaction dated Thursday, May 14th. The stock was sold at an average price of $45.46, for a total transaction of $759,682.06. Following the transaction, the director directly owned 12,805 shares of the company’s stock, valued at $582,115.30. The trade was a 56.62% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, SVP Ian Kent sold 2,642 shares of the business’s stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $41.56, for a total transaction of $109,801.52. Following the completion of the sale, the senior vice president owned 25,392 shares in the company, valued at approximately $1,055,291.52. This trade represents a 9.42% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders sold 68,607 shares of company stock worth $3,213,714. Company insiders own 0.50% of the company’s stock.

Institutional Trading of Allegro MicroSystems

A number of large investors have recently added to or reduced their stakes in ALGM. Kestra Advisory Services LLC acquired a new position in shares of Allegro MicroSystems in the 4th quarter worth $34,000. CIBC Private Wealth Group LLC increased its holdings in shares of Allegro MicroSystems by 14,844.4% during the 4th quarter. CIBC Private Wealth Group LLC now owns 1,345 shares of the company’s stock valued at $35,000 after acquiring an additional 1,336 shares during the last quarter. Caitong International Asset Management Co. Ltd raised its position in shares of Allegro MicroSystems by 85.8% in the fourth quarter. Caitong International Asset Management Co. Ltd now owns 1,449 shares of the company’s stock valued at $38,000 after purchasing an additional 669 shares during the period. Federation des caisses Desjardins du Quebec acquired a new stake in shares of Allegro MicroSystems in the fourth quarter worth $57,000. Finally, NewEdge Advisors LLC lifted its stake in shares of Allegro MicroSystems by 12,315.0% in the third quarter. NewEdge Advisors LLC now owns 2,483 shares of the company’s stock worth $73,000 after buying an additional 2,463 shares during the last quarter. 56.45% of the stock is currently owned by institutional investors.

Allegro MicroSystems Company Profile

Allegro MicroSystems, Inc (NASDAQ: ALGM) is a leading designer and manufacturer of high-performance power and sensing integrated circuits. The company focuses on semiconductor solutions that enable precise motion control, energy-efficient power management and robust sensing in a wide range of applications. Allegro’s product portfolio includes Hall-effect magnetic sensors, current and position sensing ICs, motor driver and controller devices, and power management components.

Allegro MicroSystems serves major automotive, industrial and consumer markets worldwide.