MICROCHIP TECHNOLOGY INC (MCHP) Fundamental Analysis & Valuation

NASDAQ:MCHP • US5950171042

Current stock price

64.2 USD
-0.96 (-1.47%)
At close:
64.52 USD
+0.32 (+0.5%)
After Hours:

This MCHP fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. MCHP Profitability Analysis

1.1 Basic Checks

  • MCHP had positive earnings in the past year.
  • In the past year MCHP had a positive cash flow from operations.
  • MCHP had positive earnings in 4 of the past 5 years.
  • MCHP had a positive operating cash flow in each of the past 5 years.
MCHP Yearly Net Income VS EBIT VS OCF VS FCFMCHP Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B 2B 3B

1.2 Ratios

  • MCHP has a Return On Assets of -1.09%. This is comparable to the rest of the industry: MCHP outperforms 43.48% of its industry peers.
  • MCHP has a Return On Equity of -2.39%. This is comparable to the rest of the industry: MCHP outperforms 44.35% of its industry peers.
  • MCHP has a Return On Invested Capital of 1.65%. This is comparable to the rest of the industry: MCHP outperforms 52.17% of its industry peers.
  • The Average Return On Invested Capital over the past 3 years for MCHP is in line with the industry average of 10.70%.
  • The last Return On Invested Capital (1.65%) for MCHP is well below the 3 year average (11.93%), which needs to be investigated, but indicates that MCHP had better years and this may not be a problem.
Industry RankSector Rank
ROA -1.09%
ROE -2.39%
ROIC 1.65%
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.93%
ROIC(5y)10.28%
MCHP Yearly ROA, ROE, ROICMCHP Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10 20 30

1.3 Margins

  • Looking at the Operating Margin, with a value of 6.34%, MCHP is in line with its industry, outperforming 56.52% of the companies in the same industry.
  • In the last couple of years the Operating Margin of MCHP has declined.
  • MCHP has a Gross Margin of 55.41%. This is in the better half of the industry: MCHP outperforms 75.65% of its industry peers.
  • In the last couple of years the Gross Margin of MCHP has declined.
Industry RankSector Rank
OM 6.34%
PM (TTM) N/A
GM 55.41%
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%
MCHP Yearly Profit, Operating, Gross MarginsMCHP Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20 40 60

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4

2. MCHP Health Analysis

2.1 Basic Checks

  • MCHP has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • The number of shares outstanding for MCHP has been increased compared to 1 year ago.
  • The number of shares outstanding for MCHP has been increased compared to 5 years ago.
  • The debt/assets ratio for MCHP has been reduced compared to a year ago.
MCHP Yearly Shares OutstandingMCHP Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 100M 200M 300M 400M 500M
MCHP Yearly Total Debt VS Total AssetsMCHP Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B

2.2 Solvency

  • An Altman-Z score of 3.69 indicates that MCHP is not in any danger for bankruptcy at the moment.
  • The Altman-Z score of MCHP (3.69) is comparable to the rest of the industry.
  • MCHP has a debt to FCF ratio of 6.54. This is a slightly negative value and a sign of low solvency as MCHP would need 6.54 years to pay back of all of its debts.
  • MCHP has a Debt to FCF ratio (6.54) which is in line with its industry peers.
  • MCHP has a Debt/Equity ratio of 0.82. This is a neutral value indicating MCHP is somewhat dependend on debt financing.
  • With a Debt to Equity ratio value of 0.82, MCHP is not doing good in the industry: 80.87% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 0.82
Debt/FCF 6.54
Altman-Z 3.69
ROIC/WACC0.15
WACC11.16%
MCHP Yearly LT Debt VS Equity VS FCFMCHP Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B

2.3 Liquidity

  • A Current Ratio of 2.16 indicates that MCHP has no problem at all paying its short term obligations.
  • With a Current ratio value of 2.16, MCHP is not doing good in the industry: 73.04% of the companies in the same industry are doing better.
  • MCHP has a Quick Ratio of 1.16. This is a normal value and indicates that MCHP is financially healthy and should not expect problems in meeting its short term obligations.
  • Looking at the Quick ratio, with a value of 1.16, MCHP is doing worse than 82.61% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.16
Quick Ratio 1.16
MCHP Yearly Current Assets VS Current LiabilitesMCHP Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

4

3. MCHP Growth Analysis

3.1 Past

  • The earnings per share for MCHP have decreased strongly by -33.52% in the last year.
  • MCHP shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -14.29% yearly.
  • The Revenue has decreased by -8.08% in the past year.
  • MCHP shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -3.55% yearly.
EPS 1Y (TTM)-33.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%120%
Revenue 1Y (TTM)-8.08%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%15.59%

3.2 Future

  • Based on estimates for the next years, MCHP will show a very strong growth in Earnings Per Share. The EPS will grow by 32.12% on average per year.
  • Based on estimates for the next years, MCHP will show a quite strong growth in Revenue. The Revenue will grow by 13.84% on average per year.
EPS Next Y23.2%
EPS Next 2Y44.89%
EPS Next 3Y42.88%
EPS Next 5Y32.12%
Revenue Next Year6.11%
Revenue Next 2Y14%
Revenue Next 3Y15.44%
Revenue Next 5Y13.84%

3.3 Evolution

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
MCHP Yearly Revenue VS EstimatesMCHP Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2B 4B 6B 8B
MCHP Yearly EPS VS EstimatesMCHP Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2 4 6

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4

4. MCHP Valuation Analysis

4.1 Price/Earnings Ratio

  • A Price/Earnings ratio of 54.87 indicates a quite expensive valuation of MCHP.
  • MCHP's Price/Earnings ratio is in line with the industry average.
  • MCHP is valuated expensively when we compare the Price/Earnings ratio to 25.23, which is the current average of the S&P500 Index.
  • MCHP is valuated rather expensively with a Price/Forward Earnings ratio of 23.53.
  • Based on the Price/Forward Earnings ratio, MCHP is valued a bit cheaper than 76.52% of the companies in the same industry.
  • MCHP's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.51.
Industry RankSector Rank
PE 54.87
Fwd PE 23.53
MCHP Price Earnings VS Forward Price EarningsMCHP Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, MCHP is valued a bit cheaper than the industry average as 62.61% of the companies are valued more expensively.
  • Based on the Price/Free Cash Flow ratio, MCHP is valued a bit cheaper than 73.91% of the companies in the same industry.
Industry RankSector Rank
P/FCF 42.37
EV/EBITDA 41.2
MCHP Per share dataMCHP EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 10

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MCHP does not grow enough to justify the current Price/Earnings ratio.
  • A more expensive valuation may be justified as MCHP's earnings are expected to grow with 42.88% in the coming years.
PEG (NY)2.36
PEG (5Y)N/A
EPS Next 2Y44.89%
EPS Next 3Y42.88%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

7

5. MCHP Dividend Analysis

5.1 Amount

  • MCHP has a Yearly Dividend Yield of 2.88%. Purely for dividend investing, there may be better candidates out there.
  • Compared to an average industry Dividend Yield of 0.50, MCHP pays a better dividend. On top of this MCHP pays more dividend than 94.78% of the companies listed in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.90, MCHP pays a better dividend.
Industry RankSector Rank
Dividend Yield 2.88%

5.2 History

  • The dividend of MCHP is nicely growing with an annual growth rate of 20.15%!
  • MCHP has been paying a dividend for at least 10 years, so it has a reliable track record.
  • MCHP has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)20.15%
Div Incr Years13
Div Non Decr Years13
MCHP Yearly Dividends per shareMCHP Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.5 1 1.5

5.3 Sustainability

  • MCHP has negative earnings and hence a negative payout ratio. The dividend may be in danger.
  • The dividend of MCHP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-678.74%
EPS Next 2Y44.89%
EPS Next 3Y42.88%
MCHP Yearly Income VS Free CF VS DividendMCHP Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B 2B 3B

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MCHP Fundamentals: All Metrics, Ratios and Statistics

MICROCHIP TECHNOLOGY INC

NASDAQ:MCHP (3/26/2026, 8:00:00 PM)

After market: 64.52 +0.32 (+0.5%)

64.2

-0.96 (-1.47%)

Chartmill FA Rating
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)02-05
Earnings (Next)05-06
Inst Owners99.68%
Inst Owner Change0.54%
Ins Owners1.92%
Ins Owner Change-3.24%
Market Cap34.74B
Revenue(TTM)4.37B
Net Income(TTM)-156.60M
Analysts81.82
Price Target88.31 (37.55%)
Short Float %4.11%
Short Ratio2.31
Dividend
Industry RankSector Rank
Dividend Yield 2.88%
Yearly Dividend1.81
Dividend Growth(5Y)20.15%
DP-678.74%
Div Incr Years13
Div Non Decr Years13
Ex-Date02-23
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.66%
Min EPS beat(2)2.58%
Max EPS beat(2)4.75%
EPS beat(4)4
Avg EPS beat(4)5.43%
Min EPS beat(4)2.58%
Max EPS beat(4)11.8%
EPS beat(8)5
Avg EPS beat(8)-0.47%
EPS beat(12)6
Avg EPS beat(12)-0.53%
EPS beat(16)7
Avg EPS beat(16)-0.18%
Revenue beat(2)0
Avg Revenue beat(2)-1.55%
Min Revenue beat(2)-1.6%
Max Revenue beat(2)-1.5%
Revenue beat(4)0
Avg Revenue beat(4)-1.08%
Min Revenue beat(4)-1.6%
Max Revenue beat(4)-0.05%
Revenue beat(8)0
Avg Revenue beat(8)-1.78%
Revenue beat(12)0
Avg Revenue beat(12)-1.89%
Revenue beat(16)0
Avg Revenue beat(16)-1.68%
PT rev (1m)4.71%
PT rev (3m)15.03%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)10.44%
EPS NY rev (1m)1.64%
EPS NY rev (3m)8.68%
Revenue NQ rev (1m)0.16%
Revenue NQ rev (3m)4.38%
Revenue NY rev (1m)0.7%
Revenue NY rev (3m)2.41%
Valuation
Industry RankSector Rank
PE 54.87
Fwd PE 23.53
P/S 7.95
P/FCF 42.37
P/OCF 38.14
P/B 5.3
P/tB N/A
EV/EBITDA 41.2
EPS(TTM)1.17
EY1.82%
EPS(NY)2.73
Fwd EY4.25%
FCF(TTM)1.52
FCFY2.36%
OCF(TTM)1.68
OCFY2.62%
SpS8.08
BVpS12.12
TBVpS-4.13
PEG (NY)2.36
PEG (5Y)N/A
Graham Number17.86
Profitability
Industry RankSector Rank
ROA -1.09%
ROE -2.39%
ROCE 2.09%
ROIC 1.65%
ROICexc 1.68%
ROICexgc 5.19%
OM 6.34%
PM (TTM) N/A
GM 55.41%
FCFM 18.75%
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.93%
ROIC(5y)10.28%
ROICexc(3y)12.2%
ROICexc(5y)10.52%
ROICexgc(3y)48.65%
ROICexgc(5y)43.88%
ROCE(3y)15.1%
ROCE(5y)13.02%
ROICexgc growth 3Y-44.39%
ROICexgc growth 5Y-17.88%
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-Score4
Asset Turnover0.31
Health
Industry RankSector Rank
Debt/Equity 0.82
Debt/FCF 6.54
Debt/EBITDA 5.48
Cap/Depr 12.97%
Cap/Sales 2.08%
Interest Coverage 250
Cash Conversion 92.97%
Profit Quality N/A
Current Ratio 2.16
Quick Ratio 1.16
Altman-Z 3.69
F-Score4
WACC11.16%
ROIC/WACC0.15
Cap/Depr(3y)32.64%
Cap/Depr(5y)27.66%
Cap/Sales(3y)4.12%
Cap/Sales(5y)3.9%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-33.52%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%120%
EPS Next Y23.2%
EPS Next 2Y44.89%
EPS Next 3Y42.88%
EPS Next 5Y32.12%
Revenue 1Y (TTM)-8.08%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%15.59%
Revenue Next Year6.11%
Revenue Next 2Y14%
Revenue Next 3Y15.44%
Revenue Next 5Y13.84%
EBIT growth 1Y-56.73%
EBIT growth 3Y-41.54%
EBIT growth 5Y-11.55%
EBIT Next Year61.19%
EBIT Next 3Y43.22%
EBIT Next 5Y25.08%
FCF growth 1Y-70.87%
FCF growth 3Y-32.16%
FCF growth 5Y-12.16%
OCF growth 1Y-71.28%
OCF growth 3Y-31.89%
OCF growth 5Y-10.27%

MICROCHIP TECHNOLOGY INC / MCHP Fundamental Analysis FAQ

Can you provide the ChartMill fundamental rating for MICROCHIP TECHNOLOGY INC?

ChartMill assigns a fundamental rating of 4 / 10 to MCHP.


What is the valuation status for MCHP stock?

ChartMill assigns a valuation rating of 4 / 10 to MICROCHIP TECHNOLOGY INC (MCHP). This can be considered as Fairly Valued.


Can you provide the profitability details for MICROCHIP TECHNOLOGY INC?

MICROCHIP TECHNOLOGY INC (MCHP) has a profitability rating of 4 / 10.


What is the valuation of MICROCHIP TECHNOLOGY INC based on its PE and PB ratios?

The Price/Earnings (PE) ratio for MICROCHIP TECHNOLOGY INC (MCHP) is 54.87 and the Price/Book (PB) ratio is 5.3.


Is the dividend of MICROCHIP TECHNOLOGY INC sustainable?

The dividend rating of MICROCHIP TECHNOLOGY INC (MCHP) is 7 / 10 and the dividend payout ratio is -678.74%.