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On Tuesday, Needham analysts sustained their positive stance on Lattice (OTC:LTTC) Semiconductor (NASDAQ:LSCC) shares, reasserting a Buy rating and a $70.00 price target. This aligns with the broader analyst consensus, as InvestingPro data shows eight analysts have recently revised their earnings expectations upward, with price targets ranging from $50 to $75. Following the company’s recent earnings report, analysts highlighted several key points from Lattice Semiconductor’s performance and outlook. The company achieved results that met expectations and provided a modest upward revision. Management reaffirmed their revenue growth target for 2025, although they expressed caution regarding the second half of the year due to uncertainties surrounding tariffs.
The analysts noted that Lattice Semiconductor’s confidence in its revenue projections is bolstered by increased customer usage, a stronger backlog accumulated over recent quarters, and improved booking trends. With last twelve months revenue of $509.4 million and a healthy gross profit margin of 66.8%, the company maintains strong fundamentals. Despite the direct effects of tariffs being mitigated by Lattice’s extensive international revenue base—approximately 80% outside the U.S.—and its diversified supply chain, the analysts acknowledged that indirect risks are still difficult to quantify. According to InvestingPro’s analysis, the company’s financial health score is rated as "GOOD," with particularly strong cash flow metrics.
Lattice Semiconductor had previously aimed to maintain three months’ worth of channel inventory by the middle of the year. However, the new expectation is that reaching this inventory level will take a few additional quarters. According to Needham analysts, this revised timeline likely reflects weaker industrial consumption than initially anticipated.
The company’s cautious outlook for the latter half of 2025 is attributed to the current uncertainty surrounding tariffs, which could potentially impact the business environment. With a beta of 1.6 and trading at a P/E ratio of 120.8x, investors should note the stock’s higher volatility and premium valuation. Despite this, Lattice Semiconductor’s management remains confident in their long-term revenue growth target, supported by the company’s solid fundamentals and recent performance trends. For deeper insights into Lattice Semiconductor’s valuation and growth prospects, InvestingPro subscribers can access the comprehensive Pro Research Report, which includes detailed analysis of the company’s financial health, valuation metrics, and growth potential.
In other recent news, Lattice Semiconductor reported its financial results for the first quarter of 2025, meeting analysts’ expectations with an earnings per share (EPS) of $0.22 and revenue of $120.15 million. Despite matching forecasts, the company experienced a 15% year-over-year decline in revenue, which may have contributed to investor concerns. The company remains cautious about potential tariff impacts and provided guidance for the second quarter, projecting revenue between $118.5 million and $128.5 million. Analysts from Deutsche Bank (ETR:DBKGn) and Raymond (NSE:RYMD) James discussed the company’s cautious outlook and the potential impact of tariffs during the earnings call. Executives expressed confidence in organic growth and highlighted the strength of the cloud and AI server markets. Lattice Semiconductor continues to focus on expanding its presence in various markets, including AI, robotics, automotive, and industrial sectors. The company also mentioned its ongoing efforts to manage inventory levels and improve cost structures.
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