Gary Mobley, an analyst from Wells Fargo, maintained the Buy rating on Allegro MicroSystems (ALGM – Research Report). The associated price target is $45.00.
Gary Mobley has assigned a Buy rating to Allegro MicroSystems, based on a comprehensive analysis of the company’s long-term growth potential and current undervaluation relative to its historical metrics and small-cap growth peers. Despite recent underperformance in share price, which could be attributed to market concerns over a potential slowdown in the automotive and industrial chip sectors, as well as dilution from the Crocus acquisition, Mobley sees the stock’s current valuation as an attractive entry point for investors.
Furthermore, Mobley believes that Allegro MicroSystems has the capability to generate significant above-market revenue growth, which would be a catalyst for stock outperformance. The company’s guidance suggests a resilience through expected industry headwinds, with projections of outpacing the market in terms of revenue growth in the coming years. The report also indicates that consensus expectations for a slight revenue decline in CY24 are reasonable, leaving the analyst’s estimates unchanged. The anticipation of further details on the Crocus acquisition’s integration and cost synergies also provides a potential upside to the stock’s performance.
In another report released on January 16, Barclays also maintained a Buy rating on the stock with a $35.00 price target.
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Based on the recent corporate insider activity of 55 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of ALGM in relation to earlier this year.
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Allegro MicroSystems (ALGM) Company Description:
Allegro Microsystems Inc is a global designer, developer, fabless manufacturer and marketer of sensor ICs and application-specific analog power ICs enabling the important emerging technologies in the automotive and industrial markets. It is a supplier of power ICs. Its sensor ICs enable customers to precisely measure motion, speed, position and current, while its power ICs include high-temperature and high-voltage capable motor driver, power management and LED driver ICs. Its products are divided into three categories such as SENSE that include Current Sensors, Switches and Latches, Linear and Angular Position, Magnetic Speed Sensors, and Photonics; REGULATE that include Regulators, ClearPower Modules, and LED Drivers; and DRIVE that includes BLDC Drivers, Brush DC and Stepper Drivers.
Read More on ALGM:
- UPDATE – Allegro MicroSystems to Announce Third Quarter Fiscal Year 2024 Financial Results
- Allegro MicroSystems to Announce Third Quarter Fiscal Year 2024 Financial Results
- Allegro MicroSystems launches AHV85111 isolated gate-driver IC
- Allegro MicroSystems to Present at Needham’s 26th Annual Growth Conference on January 19
- Allegro MicroSystems management to meet virtually with Mizuho
