MICROCHIP TECHNOLOGY INC (1MCHP.MI) Stock Fundamental Analysis
BIT:1MCHP - Euronext Milan - US5950171042 - Common Stock - Currency: EUR
We assign a fundamental rating of 4 out of 10 to 1MCHP. 1MCHP was compared to 56 industry peers in the Semiconductors & Semiconductor Equipment industry. 1MCHP scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. 1MCHP is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
1MCHP had positive earnings in the past year.
In the past year 1MCHP had a positive cash flow from operations.
Of the past 5 years 1MCHP 4 years were profitable.
Of the past 5 years 1MCHP 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of 1MCHP (1.98%) is worse than 79.31% of its industry peers.
The Return On Equity of 1MCHP (5.12%) is worse than 67.24% of its industry peers.
With a Return On Invested Capital value of 3.36%, 1MCHP is not doing good in the industry: 75.86% of the companies in the same industry are doing better.
The Average Return On Invested Capital over the past 3 years for 1MCHP is below the industry average of 15.42%.
The 3 year average ROIC (11.32%) for 1MCHP is well above the current ROIC(3.36%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROIC | 3.36% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.32%
ROIC(5y)9.76%
1.3 Margins
With a Profit Margin value of 6.49%, 1MCHP is not doing good in the industry: 70.69% of the companies in the same industry are doing better.
1MCHP has a worse Operating Margin (13.47%) than 60.34% of its industry peers.
In the last couple of years the Operating Margin of 1MCHP has declined.
The Gross Margin of 1MCHP (57.95%) is better than 77.59% of its industry peers.
In the last couple of years the Gross Margin of 1MCHP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% |
OM growth 3Y-32.35%
OM growth 5Y-8.3%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.92%
GM growth 5Y-1.82%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 1MCHP is creating some value.
1MCHP has more shares outstanding than it did 1 year ago.
1MCHP has more shares outstanding than it did 5 years ago.
The debt/assets ratio for 1MCHP has been reduced compared to a year ago.
2.2 Solvency
1MCHP has an Altman-Z score of 3.46. This indicates that 1MCHP is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of 1MCHP (3.46) is worse than 68.97% of its industry peers.
The Debt to FCF ratio of 1MCHP is 6.96, which is on the high side as it means it would take 1MCHP, 6.96 years of fcf income to pay off all of its debts.
1MCHP has a Debt to FCF ratio (6.96) which is comparable to the rest of the industry.
A Debt/Equity ratio of 1.12 is on the high side and indicates that 1MCHP has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 1.12, 1MCHP is doing worse than 93.10% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 6.96 | ||
| Altman-Z | 3.46 |
ROIC/WACC0.35
WACC9.59%
2.3 Liquidity
1MCHP has a Current Ratio of 2.25. This indicates that 1MCHP is financially healthy and has no problem in meeting its short term obligations.
With a Current ratio value of 2.25, 1MCHP perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
A Quick Ratio of 1.23 indicates that 1MCHP should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.23, 1MCHP is not doing good in the industry: 65.52% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.23 |
3. Growth
3.1 Past
1MCHP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -73.52%.
Measured over the past years, 1MCHP shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -14.29% on average per year.
The Revenue for 1MCHP has decreased by -42.35% in the past year. This is quite bad
1MCHP shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -3.55% yearly.
EPS 1Y (TTM)-73.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-80.7%
Revenue 1Y (TTM)-42.35%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-26.8%
3.2 Future
Based on estimates for the next years, 1MCHP will show a very strong growth in Earnings Per Share. The EPS will grow by 30.75% on average per year.
Based on estimates for the next years, 1MCHP will show a quite strong growth in Revenue. The Revenue will grow by 9.66% on average per year.
EPS Next Y7.13%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
EPS Next 5Y30.75%
Revenue Next Year4.26%
Revenue Next 2Y12.67%
Revenue Next 3Y13.47%
Revenue Next 5Y9.66%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 53.44 indicates a quite expensive valuation of 1MCHP.
Compared to the rest of the industry, the Price/Earnings ratio of 1MCHP indicates a rather expensive valuation: 1MCHP more expensive than 81.03% of the companies listed in the same industry.
1MCHP's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.54.
A Price/Forward Earnings ratio of 49.85 indicates a quite expensive valuation of 1MCHP.
Based on the Price/Forward Earnings ratio, 1MCHP is valued expensively inside the industry as 87.93% of the companies are valued cheaper.
1MCHP is valuated rather expensively when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.44 | ||
| Fwd PE | 49.85 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1MCHP is valued a bit more expensive than 70.69% of the companies in the same industry.
1MCHP's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. 1MCHP is cheaper than 65.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.6 | ||
| EV/EBITDA | 30.67 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1MCHP does not grow enough to justify the current Price/Earnings ratio.
1MCHP's earnings are expected to grow with 36.16% in the coming years. This may justify a more expensive valuation.
PEG (NY)7.5
PEG (5Y)N/A
EPS Next 2Y40.3%
EPS Next 3Y36.16%
5. Dividend
5.1 Amount
1MCHP has a Yearly Dividend Yield of 2.57%. Purely for dividend investing, there may be better candidates out there.
1MCHP's Dividend Yield is rather good when compared to the industry average which is at 1.16. 1MCHP pays more dividend than 94.83% of the companies in the same industry.
1MCHP's Dividend Yield is comparable with the S&P500 average which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.57% |
5.2 History
On average, the dividend of 1MCHP grows each year by 18.25%, which is quite nice.
Dividend Growth(5Y)18.25%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
315.22% of the earnings are spent on dividend by 1MCHP. This is not a sustainable payout ratio.
1MCHP's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP315.22%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
BIT:1MCHP (6/20/2025, 7:00:00 PM)
59.32
+1.47 (+2.54%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners100.8%
Inst Owner ChangeN/A
Ins Owners1.91%
Ins Owner ChangeN/A
Market Cap32.00B
Analysts79.33
Price Target58.97 (-0.59%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.57% |
Yearly Dividend1.44
Dividend Growth(5Y)18.25%
DP315.22%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-11.43%
Min EPS beat(2)-27.71%
Max EPS beat(2)4.85%
EPS beat(4)1
Avg EPS beat(4)-6.38%
Min EPS beat(4)-27.71%
Max EPS beat(4)4.85%
EPS beat(8)2
Avg EPS beat(8)-3.51%
EPS beat(12)3
Avg EPS beat(12)-2.05%
EPS beat(16)6
Avg EPS beat(16)-1.21%
Revenue beat(2)0
Avg Revenue beat(2)-2.84%
Min Revenue beat(2)-4.74%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-2.49%
Min Revenue beat(4)-4.74%
Max Revenue beat(4)-0.95%
Revenue beat(8)0
Avg Revenue beat(8)-2.3%
Revenue beat(12)0
Avg Revenue beat(12)-1.88%
Revenue beat(16)0
Avg Revenue beat(16)-1.75%
PT rev (1m)11.54%
PT rev (3m)-2.36%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.53%
EPS NY rev (1m)2.85%
EPS NY rev (3m)4.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)1.04%
Revenue NY rev (3m)1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.44 | ||
| Fwd PE | 49.85 | ||
| P/S | 7.87 | ||
| P/FCF | 38.6 | ||
| P/OCF | 33.37 | ||
| P/B | 6.21 | ||
| P/tB | N/A | ||
| EV/EBITDA | 30.67 |
EPS(TTM)1.11
EY1.87%
EPS(NY)1.19
Fwd EY2.01%
FCF(TTM)1.54
FCFY2.59%
OCF(TTM)1.78
OCFY3%
SpS7.53
BVpS9.55
TBVpS-5.02
PEG (NY)7.5
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROCE | 4.48% | ||
| ROIC | 3.36% | ||
| ROICexc | 3.5% | ||
| ROICexgc | 10.65% | ||
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% | ||
| FCFM | 20.4% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.32%
ROIC(5y)9.76%
ROICexc(3y)11.58%
ROICexc(5y)9.98%
ROICexgc(3y)44.74%
ROICexgc(5y)40.79%
ROCE(3y)15.1%
ROCE(5y)13.02%
ROICexcg growth 3Y-61.75%
ROICexcg growth 5Y-34.4%
ROICexc growth 3Y-40.07%
ROICexc growth 5Y-9.14%
OM growth 3Y-32.35%
OM growth 5Y-8.3%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.92%
GM growth 5Y-1.82%
F-Score5
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 6.96 | ||
| Debt/EBITDA | 4.75 | ||
| Cap/Depr | 19.44% | ||
| Cap/Sales | 3.19% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 78.91% | ||
| Profit Quality | 314.22% | ||
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.23 | ||
| Altman-Z | 3.46 |
F-Score5
WACC9.59%
ROIC/WACC0.35
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-73.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-80.7%
EPS Next Y7.13%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
EPS Next 5Y30.75%
Revenue 1Y (TTM)-42.35%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-26.8%
Revenue Next Year4.26%
Revenue Next 2Y12.67%
Revenue Next 3Y13.47%
Revenue Next 5Y9.66%
EBIT growth 1Y-79.8%
EBIT growth 3Y-41.54%
EBIT growth 5Y-11.55%
EBIT Next Year40.73%
EBIT Next 3Y32.02%
EBIT Next 5Y25%
FCF growth 1Y-65.53%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-64.62%
OCF growth 3YN/A
OCF growth 5YN/A