Microchip Technology (NASDAQ:MCHP) Shares Gap Down Following Analyst Downgrade

Microchip Technology Incorporated (NASDAQ:MCHP)’s share price gapped down before the market opened on Friday after Citigroup lowered their price target on the stock from $92.00 to $91.00. The stock had previously closed at $78.04, but opened at $74.41. Citigroup currently has a buy rating on the stock. Microchip Technology shares last traded at $75.0370, with a volume of 1,987,291 shares.

Several other brokerages have also recently weighed in on MCHP. Stifel Nicolaus set a $80.00 price objective on Microchip Technology and gave the company a “buy” rating in a report on Tuesday, January 6th. Truist Financial upped their target price on Microchip Technology from $60.00 to $68.00 and gave the company a “hold” rating in a research report on Friday. Needham & Company LLC boosted their price target on Microchip Technology from $77.00 to $84.00 and gave the company a “buy” rating in a research note on Friday. JPMorgan Chase & Co. increased their price objective on Microchip Technology from $77.00 to $85.00 and gave the stock an “overweight” rating in a research report on Tuesday, January 6th. Finally, Mizuho upped their price target on shares of Microchip Technology from $83.00 to $90.00 and gave the company an “outperform” rating in a research note on Friday. Three investment analysts have rated the stock with a Strong Buy rating, fifteen have given a Buy rating, five have issued a Hold rating and one has given a Sell rating to the company’s stock. According to MarketBeat, the company presently has a consensus rating of “Moderate Buy” and an average target price of $85.82.

Insider Buying and Selling

In other Microchip Technology news, CFO James Eric Bjornholt sold 4,292 shares of the firm’s stock in a transaction on Tuesday, November 25th. The stock was sold at an average price of $50.39, for a total transaction of $216,273.88. Following the transaction, the chief financial officer directly owned 30,089 shares in the company, valued at $1,516,184.71. This trade represents a 12.48% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. Also, CEO Steve Sanghi sold 98,814 shares of the company’s stock in a transaction on Wednesday, January 28th. The stock was sold at an average price of $80.55, for a total value of $7,959,467.70. Following the sale, the chief executive officer owned 9,922,319 shares of the company’s stock, valued at $799,242,795.45. This trade represents a 0.99% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last ninety days, insiders sold 121,615 shares of company stock worth $9,641,654. Corporate insiders own 1.94% of the company’s stock.

Key Stories Impacting Microchip Technology

Here are the key news stories impacting Microchip Technology this week:

• Positive Sentiment: Q3 results beat consensus and showed recovery: revenue was $1.19B (+15.6% YoY) and adjusted EPS $0.44 (beat $0.43). Management set Q4 EPS guidance of $0.480–0.520 and signaled sequential sales growth, which supports a momentum recovery thesis. Microchip Q3 Results Press Release
• Positive Sentiment: Management highlighted automotive and connectivity strength (industrial Ethernet) as drivers of the recovery and flagged ~6.2% sequential sales growth expectations for Q4 — a positive signal for exposure to auto/industrial end markets. Q4 Sequential Growth / Automotive Momentum
• Positive Sentiment: Strategic partnership: Microchip and Hyundai are collaborating to explore Single‑Pair Ethernet (10BASE‑T1S) for vehicles — reinforces auto content opportunities. Hyundai Collaboration
• Positive Sentiment: Capital returns: board declared a $0.455 quarterly dividend (ex‑div Feb 23), supporting income investors and signaling confidence in cash generation. Dividend Announcement
• Positive Sentiment: Bullish analyst activity and positioning: several firms raised price targets (examples include Mizuho, Rosenblatt, Needham) and there was heavy call‑option buying (≈87,550 calls), indicating strong speculative/bullish interest. Analyst Price Target Moves (Benzinga)
• Neutral Sentiment: MarketBeat and other commentary frame Q3 as a technical/earnings inflection (return to growth and improving margins) — useful context for longer‑term thesis but not an immediate price driver by itself. MarketBeat Analysis
• Negative Sentiment: Supply‑side risk: Reuters flagged that Microchip forecasted quarterly profit below some estimates and cited memory‑supply shortages as a headwind — a near‑term risk that can pressure sentiment and margins. Reuters: Profit Forecast / Memory Shortages
• Negative Sentiment: Market reaction and analyst caution: despite the beat, shares pulled back and some analysts remain cautious or trimmed targets (TD Cowen lowered to $70; Truist holds a $68 target), which can limit near‑term upside. Zacks: Shares Drop Despite Beat TD Cowen / TipRanks

Institutional Investors Weigh In On Microchip Technology

Several institutional investors have recently modified their holdings of MCHP. Winnow Wealth LLC bought a new position in shares of Microchip Technology during the third quarter worth about $25,000. Root Financial Partners LLC acquired a new stake in shares of Microchip Technology during the 3rd quarter worth approximately $28,000. Salomon & Ludwin LLC grew its stake in Microchip Technology by 219.3% during the 3rd quarter. Salomon & Ludwin LLC now owns 479 shares of the semiconductor company’s stock valued at $32,000 after acquiring an additional 329 shares in the last quarter. Quent Capital LLC acquired a new stake in Microchip Technology in the third quarter valued at approximately $32,000. Finally, E Fund Management Hong Kong Co. Ltd. boosted its holdings in Microchip Technology by 106.8% in the 3rd quarter. E Fund Management Hong Kong Co. Ltd. now owns 517 shares of the semiconductor company’s stock valued at $33,000 after purchasing an additional 267 shares in the last quarter. 91.51% of the stock is owned by hedge funds and other institutional investors.

Microchip Technology Trading Down 2.6%

The stock has a market capitalization of $41.08 billion, a price-to-earnings ratio of -168.98, a price-to-earnings-growth ratio of 2.00 and a beta of 1.46. The company has a current ratio of 2.25, a quick ratio of 1.20 and a debt-to-equity ratio of 0.80. The business has a 50 day simple moving average of $69.54 and a 200-day simple moving average of $65.57.

Microchip Technology (NASDAQ:MCHP) last released its earnings results on Thursday, February 5th. The semiconductor company reported $0.44 EPS for the quarter, topping analysts’ consensus estimates of $0.43 by $0.01. The company had revenue of $1.19 billion for the quarter, compared to the consensus estimate of $1.19 billion. Microchip Technology had a positive return on equity of 5.21% and a negative net margin of 4.39%.Microchip Technology’s quarterly revenue was up 15.6% compared to the same quarter last year. During the same quarter last year, the business posted $0.20 EPS. Microchip Technology has set its Q4 2026 guidance at 0.480-0.520 EPS. On average, equities analysts predict that Microchip Technology Incorporated will post 1.03 earnings per share for the current year.

Microchip Technology Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Tuesday, March 10th. Investors of record on Monday, February 23rd will be paid a $0.455 dividend. This represents a $1.82 dividend on an annualized basis and a dividend yield of 2.4%. The ex-dividend date of this dividend is Monday, February 23rd. Microchip Technology’s payout ratio is currently -404.44%.

About Microchip Technology

Microchip Technology Inc is a semiconductor company headquartered in Chandler, Arizona, that designs, develops and supplies a broad portfolio of embedded control and analog semiconductors. Its product lineup centers on microcontrollers (including the well-known PIC family), digital signal controllers and associated development tools and software, along with a range of mixed-signal and analog devices, nonvolatile memory, power management, timing, interface, wireless and security products. The company also provides integrated hardware and software solutions intended to simplify embedded design and accelerate time to market for OEMs and contract manufacturers.

Microchip’s products are used across a wide range of end markets, including automotive, industrial automation, consumer electronics, communications, aerospace and defense, and Internet of Things (IoT) applications.