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On Thursday, Benchmark analyst Cody Acree maintained a Buy rating on Semtech Corp . (NASDAQ:SMTC) with a steady price target of $68.00, representing an 83% upside from the current price of $37.10. Acree’s endorsement comes in the wake of Semtech’s recent financial disclosures, which, despite a slight pre-market dip in share price, were characterized by the analyst as strong for the April quarter and promising in their outlook. According to InvestingPro data, 8 analysts have recently revised their earnings estimates upward for the upcoming period, with analyst targets ranging from $43 to $68.
Semtech reported Q2 revenue and earnings per share (EPS) at $251.1 million and $0.38, respectively, narrowly surpassing consensus estimates by approximately $1 million and one cent. The company’s guidance for the upcoming quarter suggests continued performance slightly above market expectations, with projected Q2 sales of $256 million and an EPS of $0.40, once more outpacing consensus by a similar margin. InvestingPro analysis shows the company maintains a healthy gross profit margin of 52.1% and has demonstrated strong revenue growth of 13.8% over the last twelve months.
The analyst highlighted that while there was a minor concern regarding a small expected sequential margin contraction due to product mix, the overall financial health of the company remains robust. The provided outlook by Semtech, which includes the anticipated slight increase in both sales and EPS, reflects a positive trend that aligns with Benchmark’s continued confidence in the company’s stock.
Semtech’s solid April quarter results and its guidance for the next quarter appear to reinforce the company’s market position. The slight outperformance against consensus forecasts, along with the optimistic future sales and earnings guidance, contribute to the rationale behind Benchmark’s reaffirmed Buy rating and price target for Semtech Corp.
In other recent news, Semtech Corporation reported earnings and revenue results that exceeded expectations, leading to positive adjustments in analyst ratings and price targets. Piper Sandler maintained an Overweight rating on the company with a $55 price target, noting strong performance in the data center sector and potential revenue contributions from new technologies. Stifel raised its price target for Semtech to $45, keeping a Buy rating, and highlighted the company’s momentum in infrastructure growth and the promising prospects of its CopperEdge products. Susquehanna also maintained a Positive rating with a $60 target, citing growth potential in several product areas and ongoing engagements with major partners like NVIDIA (NASDAQ:NVDA). Needham affirmed a Buy rating and a $54 price target, emphasizing Semtech’s robust first-quarter results and continued demand for its data center products and LoRa-enabled solutions. Overall, analysts are optimistic about Semtech’s future performance, with several firms projecting improvements in profitability and revenue growth. These developments reflect confidence in Semtech’s diverse product portfolio and strategic positioning in the market.
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