MICROCHIP TECHNOLOGY INC (MCHP) Stock Fundamental Analysis
USA - NASDAQ:MCHP - US5950171042 - Common Stock
53.48 USD
-1.33 (-2.43%)
53.48 USD
0 (0%)
MCHP gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 112 industry peers in the Semiconductors & Semiconductor Equipment industry. MCHP has an average financial health and profitability rating. MCHP has a correct valuation and a medium growth rate. Finally MCHP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year MCHP was profitable.
In the past year MCHP had a positive cash flow from operations.
MCHP had positive earnings in 4 of the past 5 years.
MCHP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of -1.69%, MCHP is in line with its industry, outperforming 41.07% of the companies in the same industry.
MCHP has a Return On Equity (-3.66%) which is comparable to the rest of the industry.
MCHP has a Return On Invested Capital of 0.91%. This is comparable to the rest of the industry: MCHP outperforms 49.11% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MCHP is in line with the industry average of 10.93%.
The last Return On Invested Capital (0.91%) for MCHP is well below the 3 year average (11.93%), which needs to be investigated, but indicates that MCHP had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.69% | ||
| ROE | -3.66% | ||
| ROIC | 0.91% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.93%
ROIC(5y)10.28%
1.3 Margins
MCHP has a Operating Margin (3.68%) which is in line with its industry peers.
MCHP's Operating Margin has declined in the last couple of years.
With a decent Gross Margin value of 54.06%, MCHP is doing good in the industry, outperforming 71.43% of the companies in the same industry.
MCHP's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.68% | ||
| PM (TTM) | N/A | ||
| GM | 54.06% |
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), MCHP is creating some value.
The number of shares outstanding for MCHP has been increased compared to 1 year ago.
The number of shares outstanding for MCHP has been increased compared to 5 years ago.
Compared to 1 year ago, MCHP has an improved debt to assets ratio.
2.2 Solvency
MCHP has an Altman-Z score of 3.23. This indicates that MCHP is financially healthy and has little risk of bankruptcy at the moment.
MCHP has a Altman-Z score of 3.23. This is comparable to the rest of the industry: MCHP outperforms 52.68% of its industry peers.
MCHP has a debt to FCF ratio of 7.13. This is a slightly negative value and a sign of low solvency as MCHP would need 7.13 years to pay back of all of its debts.
MCHP has a Debt to FCF ratio of 7.13. This is comparable to the rest of the industry: MCHP outperforms 50.00% of its industry peers.
A Debt/Equity ratio of 0.80 indicates that MCHP is somewhat dependend on debt financing.
MCHP has a Debt to Equity ratio of 0.80. This is amonst the worse of the industry: MCHP underperforms 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 7.13 | ||
| Altman-Z | 3.23 |
ROIC/WACC0.09
WACC10.39%
2.3 Liquidity
MCHP has a Current Ratio of 2.25. This indicates that MCHP is financially healthy and has no problem in meeting its short term obligations.
MCHP has a Current ratio of 2.25. This is in the lower half of the industry: MCHP underperforms 68.75% of its industry peers.
MCHP has a Quick Ratio of 1.20. This is a normal value and indicates that MCHP is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.20, MCHP is doing worse than 83.04% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
MCHP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -64.77%.
The earnings per share for MCHP have been decreasing by -14.29% on average. This is quite bad
The Revenue for MCHP has decreased by -23.36% in the past year. This is quite bad
MCHP shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -3.55% yearly.
EPS 1Y (TTM)-64.77%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-23.91%
Revenue 1Y (TTM)-23.36%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-2.01%
3.2 Future
Based on estimates for the next years, MCHP will show a very strong growth in Earnings Per Share. The EPS will grow by 29.71% on average per year.
The Revenue is expected to grow by 10.04% on average over the next years. This is quite good.
EPS Next Y15.47%
EPS Next 2Y41.81%
EPS Next 3Y39.35%
EPS Next 5Y29.71%
Revenue Next Year5.37%
Revenue Next 2Y12.44%
Revenue Next 3Y14.65%
Revenue Next 5Y10.04%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
MCHP is valuated quite expensively with a Price/Earnings ratio of 57.51.
Compared to the rest of the industry, the Price/Earnings ratio of MCHP is on the same level as its industry peers.
MCHP is valuated expensively when we compare the Price/Earnings ratio to 25.89, which is the current average of the S&P500 Index.
MCHP is valuated rather expensively with a Price/Forward Earnings ratio of 20.46.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MCHP indicates a somewhat cheap valuation: MCHP is cheaper than 73.21% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of MCHP to the average of the S&P500 Index (34.59), we can say MCHP is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.51 | ||
| Fwd PE | 20.46 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MCHP is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MCHP indicates a somewhat cheap valuation: MCHP is cheaper than 69.64% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.26 | ||
| EV/EBITDA | 39.78 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as MCHP's earnings are expected to grow with 39.35% in the coming years.
PEG (NY)3.72
PEG (5Y)N/A
EPS Next 2Y41.81%
EPS Next 3Y39.35%
5. Dividend
5.1 Amount
MCHP has a Yearly Dividend Yield of 3.32%. Purely for dividend investing, there may be better candidates out there.
MCHP's Dividend Yield is rather good when compared to the industry average which is at 2.17. MCHP pays more dividend than 93.75% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, MCHP pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.32% |
5.2 History
On average, the dividend of MCHP grows each year by 20.15%, which is quite nice.
MCHP has been paying a dividend for at least 10 years, so it has a reliable track record.
MCHP has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)20.15%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
The earnings of MCHP are negative and hence is the payout ratio. MCHP will probably not be able to sustain this dividend level.
The dividend of MCHP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-421.71%
EPS Next 2Y41.81%
EPS Next 3Y39.35%
53.48
-1.33 (-2.43%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners104.37%
Inst Owner Change-0.26%
Ins Owners1.93%
Ins Owner Change1.71%
Market Cap28.86B
Revenue(TTM)4.21B
Net Income(TTM)-245.10M
Analysts79.39
Price Target77.91 (45.68%)
Short Float %4.41%
Short Ratio3.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.32% |
Yearly Dividend1.81
Dividend Growth(5Y)20.15%
DP-421.71%
Div Incr Years13
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.19%
Min EPS beat(2)2.58%
Max EPS beat(2)11.8%
EPS beat(4)3
Avg EPS beat(4)-2.68%
Min EPS beat(4)-27.71%
Max EPS beat(4)11.8%
EPS beat(8)5
Avg EPS beat(8)-0.82%
EPS beat(12)5
Avg EPS beat(12)-1.03%
EPS beat(16)7
Avg EPS beat(16)-0.46%
Revenue beat(2)0
Avg Revenue beat(2)-0.83%
Min Revenue beat(2)-1.6%
Max Revenue beat(2)-0.05%
Revenue beat(4)0
Avg Revenue beat(4)-1.89%
Min Revenue beat(4)-4.74%
Max Revenue beat(4)-0.05%
Revenue beat(8)0
Avg Revenue beat(8)-1.9%
Revenue beat(12)0
Avg Revenue beat(12)-1.88%
Revenue beat(16)0
Avg Revenue beat(16)-1.69%
PT rev (1m)0.27%
PT rev (3m)1.95%
EPS NQ rev (1m)0.28%
EPS NQ rev (3m)6.92%
EPS NY rev (1m)-0.99%
EPS NY rev (3m)5.19%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.87%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 57.51 | ||
| Fwd PE | 20.46 | ||
| P/S | 6.85 | ||
| P/FCF | 38.26 | ||
| P/OCF | 34.31 | ||
| P/B | 4.31 | ||
| P/tB | N/A | ||
| EV/EBITDA | 39.78 |
EPS(TTM)0.93
EY1.74%
EPS(NY)2.61
Fwd EY4.89%
FCF(TTM)1.4
FCFY2.61%
OCF(TTM)1.56
OCFY2.91%
SpS7.81
BVpS12.41
TBVpS-4.02
PEG (NY)3.72
PEG (5Y)N/A
Graham Number16.11
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.69% | ||
| ROE | -3.66% | ||
| ROCE | 1.16% | ||
| ROIC | 0.91% | ||
| ROICexc | 0.93% | ||
| ROICexgc | 2.84% | ||
| OM | 3.68% | ||
| PM (TTM) | N/A | ||
| GM | 54.06% | ||
| FCFM | 17.91% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.93%
ROIC(5y)10.28%
ROICexc(3y)12.2%
ROICexc(5y)10.52%
ROICexgc(3y)48.65%
ROICexgc(5y)43.88%
ROCE(3y)15.1%
ROCE(5y)13.02%
ROICexgc growth 3Y-44.39%
ROICexgc growth 5Y-17.88%
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-Score3
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 7.13 | ||
| Debt/EBITDA | 6.16 | ||
| Cap/Depr | 12.08% | ||
| Cap/Sales | 2.06% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 96.37% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 3.23 |
F-Score3
WACC10.39%
ROIC/WACC0.09
Cap/Depr(3y)32.64%
Cap/Depr(5y)27.66%
Cap/Sales(3y)4.12%
Cap/Sales(5y)3.9%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-64.77%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-23.91%
EPS Next Y15.47%
EPS Next 2Y41.81%
EPS Next 3Y39.35%
EPS Next 5Y29.71%
Revenue 1Y (TTM)-23.36%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-2.01%
Revenue Next Year5.37%
Revenue Next 2Y12.44%
Revenue Next 3Y14.65%
Revenue Next 5Y10.04%
EBIT growth 1Y-86.35%
EBIT growth 3Y-41.54%
EBIT growth 5Y-11.55%
EBIT Next Year72.2%
EBIT Next 3Y31.33%
EBIT Next 5Y25.08%
FCF growth 1Y-76.11%
FCF growth 3Y-32.16%
FCF growth 5Y-12.16%
OCF growth 1Y-76.62%
OCF growth 3Y-31.89%
OCF growth 5Y-10.27%
MICROCHIP TECHNOLOGY INC / MCHP FAQ
What is the fundamental rating for MCHP stock?
ChartMill assigns a fundamental rating of 4 / 10 to MCHP.
What is the valuation status of MICROCHIP TECHNOLOGY INC (MCHP) stock?
ChartMill assigns a valuation rating of 4 / 10 to MICROCHIP TECHNOLOGY INC (MCHP). This can be considered as Fairly Valued.
Can you provide the profitability details for MICROCHIP TECHNOLOGY INC?
MICROCHIP TECHNOLOGY INC (MCHP) has a profitability rating of 4 / 10.
Can you provide the financial health for MCHP stock?
The financial health rating of MICROCHIP TECHNOLOGY INC (MCHP) is 4 / 10.
What is the expected EPS growth for MICROCHIP TECHNOLOGY INC (MCHP) stock?
The Earnings per Share (EPS) of MICROCHIP TECHNOLOGY INC (MCHP) is expected to grow by 15.47% in the next year.