MACOM Technology Solutions price target raised to $155 from $140 at Stifel

Investing.com - Stifel has raised its price target on MACOM Technology Solutions (NASDAQ:MTSI) to $155.00 from $140.00 while maintaining a Buy rating on the stock.

The price target increase represents a 35.4x CY26E P/E multiple for the semiconductor company, according to Stifel analyst Tore Svanberg.

Stifel identified several risk factors that could impact MACOM’s performance, including the general cyclicality inherent in the semiconductor industry and broader macroeconomic challenges.

Company-specific risks highlighted in the analysis include potential growth challenges in key end markets, timing and market acceptance issues for new products and technologies, and unexpected market share shifts.

The firm also noted MACOM faces limited balance sheet flexibility and near-term free cash flow generation constraints that could affect its financial performance. However, InvestingPro data indicates the company’s liquid assets exceed short-term obligations, with revenue growth of 32.6% in the last twelve months.

In other recent news, MACOM Technology Solutions Holdings Inc. reported better-than-expected financial results for the second quarter of fiscal year 2025. The company achieved an adjusted earnings per share (EPS) of $0.85, surpassing the forecasted $0.8415, while revenue reached $235.9 million, exceeding the anticipated $230.04 million. MACOM’s strong performance was driven by significant growth in its data center and telecom segments, which experienced sequential increases of 11% and 18%, respectively. Additionally, MACOM provided guidance for the third quarter of fiscal 2025, projecting revenue between $246 million and $254 million, with an adjusted EPS range of $0.87 to $0.91.

In terms of strategic developments, MACOM is focused on expanding its RF fab capacity by 30% to meet increasing demand. The company is also in the process of transitioning the Wolfspeed (NYSE:WOLF) RF business fab to its control, with the transition activities reportedly on or ahead of schedule. Analyst firms have not issued any recent upgrades or downgrades for MACOM, but the company’s positive earnings surprise and strategic initiatives have contributed to a favorable outlook. These developments reflect MACOM’s ongoing efforts to strengthen its competitive position in the semiconductor market.

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