MICROCHIP TECHNOLOGY INC (1MCHP.MI) Stock Fundamental Analysis
BIT:1MCHP - Euronext Milan - US5950171042 - Common Stock - Currency: EUR
1MCHP gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 53 industry peers in the Semiconductors & Semiconductor Equipment industry. While 1MCHP is still in line with the averages on profitability rating, there are concerns on its financial health. 1MCHP has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
1MCHP had positive earnings in the past year.
1MCHP had a positive operating cash flow in the past year.
In the past 5 years 1MCHP has always been profitable.
Each year in the past 5 years 1MCHP had a positive operating cash flow.
1.2 Ratios
1MCHP's Return On Assets of 1.98% is on the low side compared to the rest of the industry. 1MCHP is outperformed by 77.36% of its industry peers.
1MCHP has a Return On Equity of 5.12%. This is in the lower half of the industry: 1MCHP underperforms 67.92% of its industry peers.
1MCHP's Return On Invested Capital of 3.53% is on the low side compared to the rest of the industry. 1MCHP is outperformed by 71.70% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for 1MCHP is in line with the industry average of 15.50%.
The last Return On Invested Capital (3.53%) for 1MCHP is well below the 3 year average (14.53%), which needs to be investigated, but indicates that 1MCHP had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROIC | 3.53% |
ROA(3y)11.21%
ROA(5y)7.8%
ROE(3y)28.27%
ROE(5y)20.31%
ROIC(3y)14.53%
ROIC(5y)10.53%
1.3 Margins
1MCHP has a worse Profit Margin (6.49%) than 69.81% of its industry peers.
1MCHP's Profit Margin has improved in the last couple of years.
1MCHP has a worse Operating Margin (13.47%) than 60.38% of its industry peers.
1MCHP's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 57.95%, 1MCHP belongs to the top of the industry, outperforming 81.13% of the companies in the same industry.
1MCHP's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% |
OM growth 3Y22.16%
OM growth 5Y19.11%
PM growth 3Y57.24%
PM growth 5Y30.29%
GM growth 3Y1.74%
GM growth 5Y3.61%
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.
Compared to 1 year ago, 1MCHP has less shares outstanding
1MCHP has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, 1MCHP has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.41 indicates that 1MCHP is not a great score, but indicates only limited risk for bankruptcy at the moment.
1MCHP's Altman-Z score of 2.41 is on the low side compared to the rest of the industry. 1MCHP is outperformed by 77.36% of its industry peers.
The Debt to FCF ratio of 1MCHP is 6.96, which is on the high side as it means it would take 1MCHP, 6.96 years of fcf income to pay off all of its debts.
1MCHP has a Debt to FCF ratio (6.96) which is comparable to the rest of the industry.
1MCHP has a Debt/Equity ratio of 1.12. This is a high value indicating a heavy dependency on external financing.
1MCHP's Debt to Equity ratio of 1.12 is on the low side compared to the rest of the industry. 1MCHP is outperformed by 90.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 6.96 | ||
| Altman-Z | 2.41 |
ROIC/WACC0.34
WACC10.23%
2.3 Liquidity
A Current Ratio of 2.25 indicates that 1MCHP has no problem at all paying its short term obligations.
With a Current ratio value of 2.25, 1MCHP is not doing good in the industry: 60.38% of the companies in the same industry are doing better.
1MCHP has a Quick Ratio of 1.23. This is a normal value and indicates that 1MCHP is financially healthy and should not expect problems in meeting its short term obligations.
1MCHP has a worse Quick ratio (1.23) than 66.04% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.23 |
3. Growth
3.1 Past
1MCHP shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -70.57%.
Measured over the past years, 1MCHP shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.40% on average per year.
1MCHP shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -44.31%.
Measured over the past years, 1MCHP shows a small growth in Revenue. The Revenue has been growing by 7.37% on average per year.
EPS 1Y (TTM)-70.57%
EPS 3Y14.22%
EPS 5Y8.4%
EPS Q2Q%-81.48%
Revenue 1Y (TTM)-44.31%
Revenue growth 3Y11.97%
Revenue growth 5Y7.37%
Sales Q2Q%-41.89%
3.2 Future
The Earnings Per Share is expected to decrease by -2.19% on average over the next years.
Based on estimates for the next years, 1MCHP will show a decrease in Revenue. The Revenue will decrease by -1.20% on average per year.
EPS Next Y-73.09%
EPS Next 2Y-49.19%
EPS Next 3Y-20%
EPS Next 5Y-2.19%
Revenue Next Year-42.45%
Revenue Next 2Y-23.35%
Revenue Next 3Y-9.54%
Revenue Next 5Y-1.2%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
1MCHP is valuated rather expensively with a Price/Earnings ratio of 21.78.
1MCHP's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of 1MCHP to the average of the S&P500 Index (28.79), we can say 1MCHP is valued slightly cheaper.
1MCHP is valuated quite expensively with a Price/Forward Earnings ratio of 30.30.
75.47% of the companies in the same industry are cheaper than 1MCHP, based on the Price/Forward Earnings ratio.
1MCHP is valuated rather expensively when we compare the Price/Forward Earnings ratio to 21.38, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.78 | ||
| Fwd PE | 30.3 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as 1MCHP.
Based on the Price/Free Cash Flow ratio, 1MCHP is valued cheaper than 83.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.29 | ||
| EV/EBITDA | 18.86 |
4.3 Compensation for Growth
1MCHP's earnings are expected to decrease with -20.00% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)2.59
EPS Next 2Y-49.19%
EPS Next 3Y-20%
5. Dividend
5.1 Amount
1MCHP has a Yearly Dividend Yield of 3.86%.
1MCHP's Dividend Yield is rather good when compared to the industry average which is at 1.58. 1MCHP pays more dividend than 98.11% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.47, 1MCHP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
5.2 History
The dividend of 1MCHP is nicely growing with an annual growth rate of 18.25%!
Dividend Growth(5Y)18.25%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
1MCHP pays out 315.22% of its income as dividend. This is not a sustainable payout ratio.
1MCHP's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP315.22%
EPS Next 2Y-49.19%
EPS Next 3Y-20%
BIT:1MCHP (4/16/2025, 7:00:00 PM)
33.76
+1.33 (+4.1%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners99.38%
Inst Owner ChangeN/A
Ins Owners1.92%
Ins Owner ChangeN/A
Market Cap18.16B
Analysts78.67
Price Target53.94 (59.77%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
Yearly Dividend1.48
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)-0.69%
PT rev (3m)-27.75%
EPS NQ rev (1m)0.79%
EPS NQ rev (3m)-88.11%
EPS NY rev (1m)0.85%
EPS NY rev (3m)-21.7%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-40.81%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-4.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.78 | ||
| Fwd PE | 30.3 | ||
| P/S | 4.34 | ||
| P/FCF | 21.29 | ||
| P/OCF | 18.41 | ||
| P/B | 3.42 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.86 |
EPS(TTM)1.55
EY4.59%
EPS(NY)1.11
Fwd EY3.3%
FCF(TTM)1.59
FCFY4.7%
OCF(TTM)1.83
OCFY5.43%
SpS7.77
BVpS9.86
TBVpS-5.18
PEG (NY)N/A
PEG (5Y)2.59
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.98% | ||
| ROE | 5.12% | ||
| ROCE | 4.48% | ||
| ROIC | 3.53% | ||
| ROICexc | 3.68% | ||
| ROICexgc | 11.18% | ||
| OM | 13.47% | ||
| PM (TTM) | 6.49% | ||
| GM | 57.95% | ||
| FCFM | 20.4% |
ROA(3y)11.21%
ROA(5y)7.8%
ROE(3y)28.27%
ROE(5y)20.31%
ROIC(3y)14.53%
ROIC(5y)10.53%
ROICexc(3y)14.84%
ROICexc(5y)10.75%
ROICexgc(3y)59.35%
ROICexgc(5y)46.01%
ROCE(3y)18.45%
ROCE(5y)13.37%
ROICexcg growth 3Y18.42%
ROICexcg growth 5Y15.98%
ROICexc growth 3Y39.37%
ROICexc growth 5Y32.47%
OM growth 3Y22.16%
OM growth 5Y19.11%
PM growth 3Y57.24%
PM growth 5Y30.29%
GM growth 3Y1.74%
GM growth 5Y3.61%
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 | 2.41 |
F-Score5
WACC10.23%
ROIC/WACC0.34
Cap/Depr(3y)37.83%
Cap/Depr(5y)25.41%
Cap/Sales(3y)4.97%
Cap/Sales(5y)3.58%
Profit Quality(3y)156.39%
Profit Quality(5y)249.98%
High Growth Momentum
Growth
EPS 1Y (TTM)-70.57%
EPS 3Y14.22%
EPS 5Y8.4%
EPS Q2Q%-81.48%
EPS Next Y-73.09%
EPS Next 2Y-49.19%
EPS Next 3Y-20%
EPS Next 5Y-2.19%
Revenue 1Y (TTM)-44.31%
Revenue growth 3Y11.97%
Revenue growth 5Y7.37%
Sales Q2Q%-41.89%
Revenue Next Year-42.45%
Revenue Next 2Y-23.35%
Revenue Next 3Y-9.54%
Revenue Next 5Y-1.2%
EBIT growth 1Y-79.8%
EBIT growth 3Y36.78%
EBIT growth 5Y27.89%
EBIT Next Year-55.97%
EBIT Next 3Y-9.72%
EBIT Next 5Y6.3%
FCF growth 1Y-69.4%
FCF growth 3Y12.65%
FCF growth 5Y12.52%
OCF growth 1Y-69.33%
OCF growth 3Y14.71%
OCF growth 5Y11.55%