MICROCHIP TECHNOLOGY INC (1MCHP.MI) Stock Fundamental Analysis
BIT:1MCHP - Euronext Milan - US5950171042 - Common Stock - Currency: EUR
We assign a fundamental rating of 4 out of 10 to 1MCHP. 1MCHP was compared to 51 industry peers in the Semiconductors & Semiconductor Equipment industry. The financial health of 1MCHP is average, but there are quite some concerns on its profitability. While showing a medium growth rate, 1MCHP is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
1MCHP had positive earnings in the past year.
In the past year 1MCHP had a positive cash flow from operations.
1MCHP had positive earnings in 4 of the past 5 years.
Of the past 5 years 1MCHP 4 years had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 1.98%, 1MCHP is not doing good in the industry: 79.31% of the companies in the same industry are doing better.
1MCHP's Return On Equity of 5.12% is on the low side compared to the rest of the industry. 1MCHP is outperformed by 67.24% of its industry peers.
1MCHP's Return On Invested Capital of 3.36% is on the low side compared to the rest of the industry. 1MCHP is outperformed by 75.86% of its industry peers.
1MCHP had an Average Return On Invested Capital over the past 3 years of 11.32%. This is below the industry average of 15.31%.
The 3 year average ROIC (11.32%) for 1MCHP is well above the current ROIC(3.36%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROIC | 3.36% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.32%
ROIC(5y)9.76%
1.3 Margins
With a Profit Margin value of 6.49%, 1MCHP is not doing good in the industry: 70.69% of the companies in the same industry are doing better.
1MCHP has a worse Operating Margin (13.47%) than 60.34% of its industry peers.
1MCHP's Operating Margin has declined in the last couple of years.
1MCHP has a Gross Margin of 57.95%. This is in the better half of the industry: 1MCHP outperforms 77.59% of its industry peers.
In the last couple of years the Gross Margin of 1MCHP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% |
OM growth 3Y-32.35%
OM growth 5Y-8.3%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.92%
GM growth 5Y-1.82%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so 1MCHP is still creating some value.
1MCHP has more shares outstanding than it did 1 year ago.
The number of shares outstanding for 1MCHP has been increased compared to 5 years ago.
1MCHP has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.46 indicates that 1MCHP is not in any danger for bankruptcy at the moment.
1MCHP has a worse Altman-Z score (3.46) than 68.97% of its industry peers.
1MCHP has a debt to FCF ratio of 6.96. This is a slightly negative value and a sign of low solvency as 1MCHP would need 6.96 years to pay back of all of its debts.
The Debt to FCF ratio of 1MCHP (6.96) is comparable to the rest of the industry.
A Debt/Equity ratio of 1.12 is on the high side and indicates that 1MCHP has dependencies on debt financing.
With a Debt to Equity ratio value of 1.12, 1MCHP is not doing good in the industry: 93.10% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 6.96 | ||
| Altman-Z | 3.46 |
ROIC/WACC0.35
WACC9.59%
2.3 Liquidity
1MCHP has a Current Ratio of 2.25. This indicates that 1MCHP is financially healthy and has no problem in meeting its short term obligations.
1MCHP has a Current ratio of 2.25. This is comparable to the rest of the industry: 1MCHP outperforms 50.00% of its industry peers.
A Quick Ratio of 1.23 indicates that 1MCHP should not have too much problems paying its short term obligations.
1MCHP's Quick ratio of 1.23 is on the low side compared to the rest of the industry. 1MCHP is outperformed by 65.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.23 |
3. Growth
3.1 Past
The earnings per share for 1MCHP have decreased strongly by -73.52% in the last year.
Measured over the past years, 1MCHP shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -14.29% on average per year.
Looking at the last year, 1MCHP shows a very negative growth in Revenue. The Revenue has decreased by -42.35% in the last year.
The Revenue has been decreasing by -3.55% on average over the past years.
EPS 1Y (TTM)-73.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-80.7%
Revenue 1Y (TTM)-42.35%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-26.8%
3.2 Future
1MCHP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 30.75% yearly.
The Revenue is expected to grow by 9.66% on average over the next years. This is quite good.
EPS Next Y7.13%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
EPS Next 5Y30.75%
Revenue Next Year4.26%
Revenue Next 2Y12.67%
Revenue Next 3Y13.47%
Revenue Next 5Y9.66%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 53.44 indicates a quite expensive valuation of 1MCHP.
Based on the Price/Earnings ratio, 1MCHP is valued expensively inside the industry as 81.03% of the companies are valued cheaper.
1MCHP is valuated expensively when we compare the Price/Earnings ratio to 27.45, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 49.85 indicates a quite expensive valuation of 1MCHP.
87.93% of the companies in the same industry are cheaper than 1MCHP, based on the Price/Forward Earnings ratio.
1MCHP's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 21.90.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.44 | ||
| Fwd PE | 49.85 |
4.2 Price Multiples
1MCHP's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. 1MCHP is more expensive than 70.69% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, 1MCHP is valued a bit cheaper than the industry average as 65.52% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.6 | ||
| EV/EBITDA | 30.67 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1MCHP does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as 1MCHP's earnings are expected to grow with 36.16% in the coming years.
PEG (NY)7.5
PEG (5Y)N/A
EPS Next 2Y40.3%
EPS Next 3Y36.16%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.57%, 1MCHP has a reasonable but not impressive dividend return.
1MCHP's Dividend Yield is rather good when compared to the industry average which is at 1.12. 1MCHP pays more dividend than 94.83% of the companies in the same industry.
1MCHP's Dividend Yield is comparable with the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.57% |
5.2 History
On average, the dividend of 1MCHP grows each year by 18.25%, which is quite nice.
Dividend Growth(5Y)18.25%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
315.22% of the earnings are spent on dividend by 1MCHP. This is not a sustainable payout ratio.
The dividend of 1MCHP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP315.22%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
BIT:1MCHP (6/20/2025, 7:00:00 PM)
59.32
+1.47 (+2.54%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners100.8%
Inst Owner ChangeN/A
Ins Owners1.91%
Ins Owner ChangeN/A
Market Cap32.00B
Analysts79.33
Price Target58.97 (-0.59%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.57% |
Yearly Dividend1.44
Dividend Growth(5Y)18.25%
DP315.22%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-11.43%
Min EPS beat(2)-27.71%
Max EPS beat(2)4.85%
EPS beat(4)1
Avg EPS beat(4)-6.38%
Min EPS beat(4)-27.71%
Max EPS beat(4)4.85%
EPS beat(8)2
Avg EPS beat(8)-3.51%
EPS beat(12)3
Avg EPS beat(12)-2.05%
EPS beat(16)6
Avg EPS beat(16)-1.21%
Revenue beat(2)0
Avg Revenue beat(2)-2.84%
Min Revenue beat(2)-4.74%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-2.49%
Min Revenue beat(4)-4.74%
Max Revenue beat(4)-0.95%
Revenue beat(8)0
Avg Revenue beat(8)-2.3%
Revenue beat(12)0
Avg Revenue beat(12)-1.88%
Revenue beat(16)0
Avg Revenue beat(16)-1.75%
PT rev (1m)11.54%
PT rev (3m)-2.36%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.53%
EPS NY rev (1m)2.85%
EPS NY rev (3m)4.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)1.04%
Revenue NY rev (3m)1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 53.44 | ||
| Fwd PE | 49.85 | ||
| P/S | 7.87 | ||
| P/FCF | 38.6 | ||
| P/OCF | 33.37 | ||
| P/B | 6.21 | ||
| P/tB | N/A | ||
| EV/EBITDA | 30.67 |
EPS(TTM)1.11
EY1.87%
EPS(NY)1.19
Fwd EY2.01%
FCF(TTM)1.54
FCFY2.59%
OCF(TTM)1.78
OCFY3%
SpS7.53
BVpS9.55
TBVpS-5.02
PEG (NY)7.5
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROCE | 4.48% | ||
| ROIC | 3.36% | ||
| ROICexc | 3.5% | ||
| ROICexgc | 10.65% | ||
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% | ||
| FCFM | 20.4% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.32%
ROIC(5y)9.76%
ROICexc(3y)11.58%
ROICexc(5y)9.98%
ROICexgc(3y)44.74%
ROICexgc(5y)40.79%
ROCE(3y)15.1%
ROCE(5y)13.02%
ROICexcg growth 3Y-61.75%
ROICexcg growth 5Y-34.4%
ROICexc growth 3Y-40.07%
ROICexc growth 5Y-9.14%
OM growth 3Y-32.35%
OM growth 5Y-8.3%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.92%
GM growth 5Y-1.82%
F-Score5
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 6.96 | ||
| Debt/EBITDA | 4.75 | ||
| Cap/Depr | 19.44% | ||
| Cap/Sales | 3.19% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 78.91% | ||
| Profit Quality | 314.22% | ||
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.23 | ||
| Altman-Z | 3.46 |
F-Score5
WACC9.59%
ROIC/WACC0.35
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-73.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-80.7%
EPS Next Y7.13%
EPS Next 2Y40.3%
EPS Next 3Y36.16%
EPS Next 5Y30.75%
Revenue 1Y (TTM)-42.35%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-26.8%
Revenue Next Year4.26%
Revenue Next 2Y12.67%
Revenue Next 3Y13.47%
Revenue Next 5Y9.66%
EBIT growth 1Y-79.8%
EBIT growth 3Y-41.54%
EBIT growth 5Y-11.55%
EBIT Next Year40.73%
EBIT Next 3Y32.02%
EBIT Next 5Y25%
FCF growth 1Y-65.53%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-64.62%
OCF growth 3YN/A
OCF growth 5YN/A