Chip designer Allegro MicroSystems (NASDAQ: ALGM) will be reporting results this Thursday before market hours. Here’s what you need to know.
Allegro MicroSystems beat analysts’ revenue expectations last quarter, reporting revenues of $243.2 million, up 26.1% year on year. It was a mixed quarter for the company, with a decent beat of analysts’ operating income estimates but a significant miss of analysts’ EPS estimates.
Is Allegro MicroSystems a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Allegro MicroSystems’s revenue to grow 23.6% year on year, improving from the 21.9% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Allegro MicroSystems rarely misses Wall Street’s revenue estimates.
Looking at Allegro MicroSystems’s peers in the processors and graphics chips segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Intel delivered year-on-year revenue growth of 25.4%, beating analysts’ expectations by 11.7%, and Penguin Solutions reported revenues up 47.6%, topping estimates by 17.5%. Intel traded down 8% following the results while Penguin Solutions was up 25.1%.
Read our full analysis of Intel’s results here and Penguin Solutions’s results here.
Over the last year or so, investors' attention has moved from one major market theme to the next, spanning AI disruption and surging infrastructure investment to geopolitical tensions, interest rates, and the health of the broader economy. Investors in processors and graphics chips stocks haven’t been spared in this environment as share prices are down 20.1% on average over the last month. Allegro MicroSystems is down 33% during the same time and is heading into earnings with an average analyst price target of $56.55 (compared to the current share price of $44.46).
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