75.92 USD
-3.44 (-4.33%)
At close: Jan 30, 2026
74.1 USD
-1.82 (-2.4%)
Pre-Market: 2/2/2026, 8:15:31 AM
Taking everything into account, MCHP scores 4 out of 10 in our fundamental rating. MCHP was compared to 113 industry peers in the Semiconductors & Semiconductor Equipment industry. MCHP has only an average score on both its financial health and profitability. MCHP is valied quite expensively at the moment, while it does show a decent growth rate. MCHP also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- MCHP had positive earnings in the past year.
- MCHP had a positive operating cash flow in the past year.
- Of the past 5 years MCHP 4 years were profitable.
- MCHP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- MCHP has a Return On Assets (-1.69%) which is in line with its industry peers.
- MCHP has a Return On Equity (-3.66%) which is comparable to the rest of the industry.
- MCHP's Return On Invested Capital of 0.91% is in line compared to the rest of the industry. MCHP outperforms 49.56% of its industry peers.
- MCHP had an Average Return On Invested Capital over the past 3 years of 11.93%. This is in line with the industry average of 10.85%.
- The 3 year average ROIC (11.93%) for MCHP is well above the current ROIC(0.91%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.69% | ||
| ROE | -3.66% | ||
| ROIC | 0.91% |
ROA(3y)8.56%
ROA(5y)7.14%
ROE(3y)20.99%
ROE(5y)18.26%
ROIC(3y)11.93%
ROIC(5y)10.28%
1.3 Margins
- MCHP's Operating Margin of 3.68% is in line compared to the rest of the industry. MCHP outperforms 53.98% of its industry peers.
- In the last couple of years the Operating Margin of MCHP has declined.
- MCHP's Gross Margin of 54.06% is fine compared to the rest of the industry. MCHP outperforms 70.80% of its industry peers.
- In the last couple of years the Gross Margin of MCHP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.68% | ||
| PM (TTM) | N/A | ||
| GM | 54.06% |
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 MCHP is still creating some value.
- The number of shares outstanding for MCHP has been increased compared to 1 year ago.
- MCHP has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, MCHP has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 4.11 indicates that MCHP is not in any danger for bankruptcy at the moment.
- MCHP's Altman-Z score of 4.11 is in line compared to the rest of the industry. MCHP outperforms 53.10% of its industry peers.
- MCHP has a debt to FCF ratio of 7.13. This is a slightly negative value and a sign of low solvency as MCHP would need 7.13 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 7.13, MCHP is in line with its industry, outperforming 50.44% of the companies in the same industry.
- A Debt/Equity ratio of 0.80 indicates that MCHP is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.80, MCHP is doing worse than 80.53% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | 7.13 | ||
| Altman-Z | 4.11 |
ROIC/WACC0.09
WACC10.65%
2.3 Liquidity
- A Current Ratio of 2.25 indicates that MCHP has no problem at all paying its short term obligations.
- The Current ratio of MCHP (2.25) is worse than 70.80% of its industry peers.
- MCHP has a Quick Ratio of 1.20. This is a normal value and indicates that MCHP is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of MCHP (1.20) is worse than 81.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.25 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
- The earnings per share for MCHP have decreased strongly by -64.77% 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 for MCHP has decreased by -23.36% in the past year. This is quite bad
- The Revenue has been decreasing by -3.55% on average over the past years.
EPS 1Y (TTM)-64.77%
EPS 3Y-34.42%
EPS 5Y-14.29%
EPS Q2Q%-23.91%
Revenue 1Y (TTM)-23.36%
Revenue growth 3Y-13.58%
Revenue growth 5Y-3.55%
Sales Q2Q%-2.01%
3.2 Future
- MCHP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 29.55% yearly.
- Based on estimates for the next years, MCHP will show a quite strong growth in Revenue. The Revenue will grow by 12.88% on average per year.
EPS Next Y19.08%
EPS Next 2Y44.43%
EPS Next 3Y41.69%
EPS Next 5Y29.55%
Revenue Next Year5.22%
Revenue Next 2Y12.73%
Revenue Next 3Y14.58%
Revenue Next 5Y12.88%
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 accelerating.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 81.63, the valuation of MCHP can be described as expensive.
- MCHP's Price/Earnings is on the same level as the industry average.
- MCHP's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 28.32.
- The Price/Forward Earnings ratio is 27.99, which means the current valuation is very expensive for MCHP.
- 74.34% of the companies in the same industry are more expensive than MCHP, based on the Price/Forward Earnings ratio.
- MCHP's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.57.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 81.63 | ||
| Fwd PE | 27.99 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as MCHP.
- Based on the Price/Free Cash Flow ratio, MCHP is valued a bit cheaper than 67.26% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 54.39 | ||
| EV/EBITDA | 52.9 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- MCHP's earnings are expected to grow with 41.69% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.28
PEG (5Y)N/A
EPS Next 2Y44.43%
EPS Next 3Y41.69%
5. Dividend
5.1 Amount
- MCHP has a Yearly Dividend Yield of 2.29%. Purely for dividend investing, there may be better candidates out there.
- MCHP's Dividend Yield is rather good when compared to the industry average which is at 0.50. MCHP pays more dividend than 93.81% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.83, MCHP pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.29% |
5.2 History
- On average, the dividend of MCHP grows each year by 20.15%, which is quite nice.
- MCHP has paid a dividend for at least 10 years, which is a reliable track record.
- MCHP has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)20.15%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
- The earnings of MCHP are negative and hence is the payout ratio. MCHP will probably not be able to sustain this dividend level.
- The dividend of MCHP is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-421.71%
EPS Next 2Y44.43%
EPS Next 3Y41.69%
MICROCHIP TECHNOLOGY INC / MCHP 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 3 / 10 to MICROCHIP TECHNOLOGY INC (MCHP). This can be considered as Overvalued.
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 81.63 and the Price/Book (PB) ratio is 6.13.
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 -421.71%.