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Investing.com - Craig-Hallum has raised its price target on Semtech Corp. (NASDAQ:SMTC) to $62.00 from $55.00 while maintaining a Buy rating, citing the company’s strong positioning in the AI data center market. The stock, currently trading at $56.01 with a market cap of $4.81B, has shown strong momentum with a 31% gain over the past six months. According to InvestingPro data, 8 analysts have recently revised their earnings estimates upward for the upcoming period.
The firm highlighted Semtech’s upcoming Linear Packet Optical (LPO) and Transimpedance Amplifier (TIA) ramps, along with Active Copper Cable (ACC) deployments with three hyperscalers - two from the U.S. and one from China. Craig-Hallum expects these developments to drive strong growth for Semtech in calendar year 2026. The company has already demonstrated solid growth momentum, with revenue increasing by 13.83% in the last twelve months. InvestingPro offers 10+ additional insights and a comprehensive analysis of Semtech’s growth prospects.
Semtech’s fiber optic business remains robust, compensating for the temporary slowdown in ACC revenues caused by previous NVIDIA delays, according to the research note. The company anticipates significant growth in data center revenues in fiscal year 2027.
The firm also noted increasing bookings in Semtech’s IoT business as customers shift away from Quectel in favor of Semtech designs. These design wins are expected to translate into strong revenue growth later in calendar 2025.
Craig-Hallum reported that Semtech’s LoRa business is now projected to generate between $30-40 million in quarterly revenue, an increase from the previous estimate of $30-35 million.
In other recent news, Semtech Corporation reported its second quarter fiscal 2026 results, showcasing a 20% year-over-year revenue growth and a significant increase in adjusted earnings. The company’s performance exceeded expectations, with earnings nearly quadrupling compared to the previous year. This strong financial showing has led Piper Sandler to raise its price target for Semtech to $65, highlighting the company’s robust growth in its FiberEdge business. Similarly, Stifel increased its price target to $57, citing Semtech’s successful turnaround and potential for further operational leverage through 2025. Benchmark also reiterated its Buy rating, maintaining a $68 price target, following the company’s solid performance and moderate revenue upside. These recent developments reflect the positive outlook from multiple analyst firms, indicating confidence in Semtech’s growth trajectory.
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