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Investing.com - Needham has raised its price target on Silicon Motion Technology (NASDAQ:SIMO) to $90.00 from $65.00 while maintaining a Buy rating on the stock. The company, currently trading at $76.54, has shown impressive momentum with a 43% gain over the past six months, according to InvestingPro data.
The price target increase follows Silicon Motion’s significant beat-and-raise quarter, driven by mobile share gains and anticipated adoption of the company’s PCIe Gen5 solutions by PC OEMs.
Needham noted that Silicon Motion appears to have crossed over historical valuation comparisons due to share gain momentum and forthcoming diversification, with both Enterprise and Auto segments showing continued improvement.
The firm has increased revenue estimates across all major segments for Silicon Motion, though it also noted that rising operating expenses will hold back bottom line expansion in calendar year 2026.
The new $90 price target is based on approximately 18 times CY26 price-to-earnings ratio and roughly $6 in net cash per share, according to Needham’s analysis.
In other recent news, Silicon Motion Technology reported its first-quarter financial results for 2025, highlighting a mixed performance. The company announced quarterly sales of $166 million, marking a 12% decrease from the previous year but reaching the upper end of their guidance range of $158 to $167 million. This sales figure also surpassed the consensus estimate of $163 million. The gross margin remained stable at 47%, meeting expectations. Additionally, Bank of America Securities upgraded Silicon Motion from Neutral to Buy, citing partnerships with major NAND chipmakers and U.S. Big Tech companies, including NVIDIA (NASDAQ:NVDA), as key catalysts. The price target was raised to $90.00 from $55.00. Earlier, BofA Securities had increased the price target to $55.00 from $47.00, maintaining a Neutral stance at that time. Furthermore, Silicon Motion announced the appointment of Jeffrey Ju as Senior Vice President of Platform & Strategy. Ju will focus on platform development and strengthening global R&D capabilities.
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