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Is this Large Market Cap Stock target price reasonable for Microchip Technology Inc. (NASDAQ:MCHP)?

The company in question is, Microchip Technology Inc. (NASDAQ:MCHP) currently with a stock price of 54.01 (0.39% today). The market cap for Microchip Technology Inc. is 11534.18, and is in the sector Technology, and Semiconductor – Specialized industry. The target price for Microchip Technology Inc. is 55.35. Currently Microchip Technology Inc. is trading with a P/E of 36.06, and a forward P/E of 14.55. Average volume for Microchip Technology Inc. is 2015.83 and so far today it is 619048.

Performance in the last year for Microchip Technology Inc. has been 31.95%. For EPS growth, Microchip Technology Inc. has seen a growth of -9.70%, and is looking to grow in the next year to 17.03%. More long term stats show that EPS growth has been -7.50% over the last five years and could be 12.80% for the next five years. Microchip Technology Inc. has seen sales growth quarter over quarter at 2.70%, with EPS growth quarter over quarter at -31.20%. The 20-day simple moving average is 5.84%, with the 200-day simple moving average coming to 14.81%.

Since the IPO date for Microchip Technology Inc. on the 3/19/1993, Microchip Technology Inc. has seen performance year to date to be 17.46%. With Microchip Technology Inc. trading at 54.01, the dividend yield is 2.68%, and the EPS is 1.49.

So could Microchip Technology Inc., be undervalued? Well as said before P/E is 36.06. The PEG is 2.82, P/S is 5.31 and the P/B is at 5.09. The P/cash is 4.72, with P/free cash flow at 32.44.

Microchip Technology Inc. ability to deal with debt shows that the current ratio is 8.1, and the quick ratio is 7.3. This is with long term debt/equity at 1.15, and total debt/equity at 0.

In terms of margins, Microchip Technology Inc. has a gross margin of 55.50%, an operating margin of 16.20% and a profit margin of 14.90%.Payout ratio for Microchip Technology Inc. is 89.80%. Return on assets come to 6.00% with return on investment coming to 8.50%.

Insider ownership for Microchip Technology Inc., is at 2.38% and institutional ownership comes to 98.80%. Outstanding shares are at 214.39. While shares float is 209.84. The float short is currently 10.15%, and short ratio is 10.57.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Tony Dabbs

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