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On Monday, Stifel analysts adjusted their price target on Semtech Corp . (NASDAQ: NASDAQ:SMTC (NASDAQ:SMTX)) shares, lowering it to $70 from the previous $75, while continuing to recommend a Buy rating for the stock. According to InvestingPro data, the stock has experienced significant volatility recently, with a -14.1% return over the past week, though it maintains an impressive 159.57% gain over the last year. Current analysis suggests the stock is trading above its Fair Value. The revision follows the company’s projection of lower-than-expected revenue from its CopperEdge products, which are primarily utilized in active copper cables for artificial intelligence and data center applications.
The company’s forecast for fiscal year 2026 (ending January) now anticipates that revenue from CopperEdge will not meet earlier minimum expectations of $50 million. Semtech has indicated that due to changes in rack architectures and recent input from a specific server rack customer, they do not anticipate a ramp-up in sales over the next approximately 12 months. The company’s financial metrics from InvestingPro show a current revenue of $851.23M with a healthy gross profit margin of 50.11%, though it’s currently not profitable over the last twelve months.
Despite this, Semtech expects to diversify its CopperEdge revenue across a variety of customers, end-users, and applications during fiscal year 2026. The company remains engaged in the development of next-generation server rack designs with its CopperEdge product lineup.
Stifel’s analysts expressed disappointment with the disclosure made on Friday but reiterated their Buy rating on Semtech’s shares. The adjusted price target of $70 reflects a tempered near-term upside potential for the calendar year 2025 and is based on a 6.1x enterprise value to calendar year 2025 sales multiple. The analysts’ statement underscored their continued support for the stock despite the recent developments. InvestingPro data reveals strong analyst consensus with a bullish 1.54 recommendation score, and price targets ranging from $60 to $85. Subscribers can access 8 additional ProTips and comprehensive financial analysis in the Pro Research Report, available exclusively on the platform.
In other recent news, Semtech Corporation has made significant strides in its corporate and financial developments. The company has appointed Jason Green as its new executive vice president and chief commercial officer. Green, renowned in the semiconductor and technology sectors, is expected to oversee Semtech’s global sales, marketing, and go-to-market strategy.
Semtech has also been the subject of increased attention from financial analysts. Piper Sandler maintained an Overweight rating on the company, citing strong growth potential in the Asset Control Center solutions sector and a focus on optimizing the balance sheet. Similarly, Needham has continued a Buy rating and increased the stock’s price target, following a successful follow-on offering of common stock that raised an estimated $640.7 million for debt reduction.
Northland has also adjusted its price target for Semtech, maintaining an Outperform rating. This revision comes after the company’s recent equity offering, which is anticipated to result in a significant reduction in annual interest expenses. Lastly, Semtech has upsized its public stock offering to approximately $575 million, primarily aimed at repaying certain debts under its credit agreement. These are the recent developments in Semtech’s journey.
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