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Why the quality investor may take a look at NASDAQ:MCHP.

By Mill Chart

Last update: May 1, 2024

In this article we will dive into MICROCHIP TECHNOLOGY INC (NASDAQ:MCHP) as a possible candidate for quality investing. Investors should always do their own research, but we noticed MICROCHIP TECHNOLOGY INC showing up in our Caviar Cruise quality screen, which makes it worth to investigate a bit more.

A Deep Dive into MICROCHIP TECHNOLOGY INC's Quality Metrics.

  • MICROCHIP TECHNOLOGY INC has demonstrated significant revenue growth over the past 5 years, with a 16.21% increase. This underscores the company's ability to adapt to market dynamics and capitalize on growth opportunities.
  • The ROIC excluding cash and goodwill of MICROCHIP TECHNOLOGY INC stands at 87.76%, reflecting the company's strong financial management and profitability. This metric underscores its ability to generate favorable returns on the capital invested in its core operations.
  • MICROCHIP TECHNOLOGY INC maintains a healthy Debt/Free Cash Flow Ratio of 2.02, indicating a strong financial position and prudent debt management. This ratio suggests the company has sufficient free cash flow to cover its debt obligations and highlights its ability to generate cash from operations.
  • With a robust Profit Quality (5-year) ratio of 304.0%, MICROCHIP TECHNOLOGY INC highlights its ability to consistently generate high-quality profits. This metric reflects the company's effective management and operational excellence in delivering reliable earnings over the long term.
  • MICROCHIP TECHNOLOGY INC has consistently achieved strong EBIT growth over the past 5 years, with a 26.68% increase. This underscores the company's effective management of its operating income and suggests a positive outlook for future profitability.
  • MICROCHIP TECHNOLOGY INC has achieved superior EBIT 5-year growth compared to its Revenue 5-year growth. This demonstrates the company's ability to maximize its profitability through effective cost management and operational strategies.

Zooming in on the fundamentals.

As part of its analysis, ChartMill provides a comprehensive Fundamental Rating for each stock. This rating, ranging from 0 to 10, is updated on a daily basis and is based on the evaluation of various fundamental indicators and properties.

Overall MCHP gets a fundamental rating of 6 out of 10. We evaluated MCHP against 107 industry peers in the Semiconductors & Semiconductor Equipment industry. MCHP scores excellent on profitability, but there are some minor concerns on its financial health. MCHP has a decent growth rate and is not valued too expensively. MCHP also has an excellent dividend rating.

For an up to date full fundamental analysis you can check the fundamental report of MCHP

More quality stocks can be found in our Caviar Cruise screen.


This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.