MACOM Technology Solutions sees stock drop amid market decline
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 03 2024
0mins
Should l Buy MTSI?
Source: 4
MACOM Technology Solutions Holdings Inc's stock fell by 6.07% today, hitting a 5-day low. This decline comes as the broader market also faced challenges, with the Nasdaq-100 down 1.55% and the S&P 500 down 0.88%.
The drop in MACOM's stock price is attributed to sector rotation, as the company is experiencing solid demand for its high-speed optical components, particularly in data centers and military applications. Despite the overall market weakness, MACOM holds a Zacks Rank of #2 (Buy), indicating strong growth expectations and a notable increase in earnings estimates.
Investors may view this price movement as a temporary setback, given the company's strong position in the semiconductor market and the ongoing demand for its products. The current market conditions suggest that while MACOM faces short-term pressure, its long-term growth potential remains intact.
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Analyst Views on MTSI
Wall Street analysts forecast MTSI stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for MTSI is 193.50 USD with a low forecast of 165.00 USD and a high forecast of 220.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
12 Analyst Rating
9 Buy
3 Hold
0 Sell
Strong Buy
Current: 227.800
Low
165.00
Averages
193.50
High
220.00
Current: 227.800
Low
165.00
Averages
193.50
High
220.00
About MTSI
MACOM Technology Solutions Holdings, Inc. designs and manufactures high-performance semiconductor products for the industrial and defense, data center and telecommunications industries. It services over 6,000 customers annually with a product portfolio that incorporates radio frequency (RF), microwave, analog and mixed signal and optical semiconductor technologies. The Company is specialized in application, analog and mixed signal circuit design, compound semiconductor fabrication (including gallium arsenide (GaAs), gallium nitride (GaN), indium phosphide (InP) and specialized silicon), advanced packaging and back-end assembly and test. It offers a broad portfolio of standard and custom devices, which include integrated circuits (IC), multi-chip modules (MCM), diodes, amplifiers, switches and switch limiters, passive and active components and RF and optical subsystems. Its products are electronic components that its customers generally incorporate into larger electronic systems.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Stock Price Update: The company has raised its target price to $265 from a previous $245.
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- Strong Performance: MACOM Technology achieved revenue of $271.6 million in Q1 2026, reflecting a 4% sequential increase and a 24.5% year-over-year growth, indicating robust market demand and record backlog, showcasing the company's solid performance across all markets.
- Data Center Growth: CEO Stephen Daly noted that Data Center revenue is projected to achieve a year-over-year growth rate of 35% to 40%, driven by robust capital investments from hyperscalers, which is boosting demand for the company's 800 and 1.6T optical and high-speed analog products, thereby strengthening its market position.
- Margin Improvement: The adjusted gross profit for Q1 was $156.5 million, representing 57.6% of revenue, while adjusted operating income reached $74 million, demonstrating the company's ongoing improvements in cost control and operational efficiency, which enhances confidence in future profitability.
- Outlook: Daly expects Q2 revenue to range between $281 million and $289 million, with adjusted gross margins projected between 57% and 59%, indicating a positive outlook for future growth, particularly in the expanding Data Center and Telecom markets.
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- Strong Performance: MACOM Technology reported a Q1 non-GAAP EPS of $1.02, beating expectations by $0.02, indicating a sustained enhancement in profitability and reflecting its competitive position in the market.
- Revenue Growth: The company achieved revenue of $271.6 million in Q1, representing a 24.5% year-over-year increase, surpassing market expectations by $2.58 million, showcasing MACOM's success in demand growth and market share expansion.
- Stable Gross Margin: The adjusted gross margin was 57.6%, slightly up from 57.5% in the previous year, demonstrating ongoing improvements in cost control and operational efficiency, which helps bolster investor confidence.
- Positive Outlook: MACOM expects Q2 revenue to range between $281 million and $289 million, exceeding the market consensus of $275.73 million, with adjusted EPS projected between $1.05 and $1.09, further solidifying market optimism regarding its future growth.
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- Significant Earnings Growth: Macom Technology reported a 29% year-over-year increase in adjusted EPS to $1.02 and a 24.5% rise in revenue to $271.6 million for the first quarter ended January 2, exceeding analyst expectations and demonstrating strong performance in the semiconductor market.
- Improved Gross Margin: The company's gross margin for the first quarter was 55.9%, up from 53.7% in the same quarter last year and 54.5% in the previous quarter, indicating effective cost control and pricing strategies that enhance profitability.
- Optimistic Q2 Outlook: Macom expects revenue for the second quarter to range between $281 million and $289 million (midpoint at $285 million), surpassing the consensus estimate of $275.73 million, reflecting confidence in future growth.
- Adjusted EPS Forecast: The company anticipates adjusted EPS for the second quarter to be between $1.05 and $1.09 (midpoint at $1.07), also above the consensus estimate of $1.03, further showcasing its ongoing profitability and competitive position.
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- Revenue Growth Expectations: The revenue estimate for the first quarter stands at $269.02 million, representing a 23.3% year-over-year growth, showcasing MACOM's steady sales increase amid strong market demand.
- Performance Beat Record: Over the past two years, MACOM has beaten EPS estimates 88% of the time and revenue estimates 100% of the time, demonstrating the company's consistency and reliability in financial performance.
- Revision Trends: In the last three months, EPS estimates have seen 12 upward revisions and 1 downward revision, while revenue estimates have experienced 13 upward revisions with none downward, reflecting analysts' optimistic outlook on the company's future performance.
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- Analyst Rating Changes: Top Wall Street analysts have adjusted their ratings on several companies, reflecting varying market perspectives on their future performance, which could influence investor decisions and market sentiment.
- AMZN Stock Outlook: Analysts' opinions on Amazon (AMZN) stock indicate mixed views on its future growth potential, prompting investors to pay close attention to the latest ratings and recommendations when considering purchases.
- Impact of Rating Changes: Upgrades and downgrades from analysts can lead to stock price volatility, necessitating that investors closely monitor these changes to timely adjust their investment strategies and optimize their portfolios.
- Market Sentiment Reflection: Changes in analyst ratings not only affect individual stock performance but can also impact overall market sentiment, urging investors to consider these factors comprehensively for informed investment decisions.
See More
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Company Overview: MACOM Technology Solutions Holdings Inc. is a technology company focused on providing semiconductor solutions.
Stock Price Update: The company has raised its target price to $265 from a previous $245.
See More
MACOM Technology Reports Record Q1 Earnings with Strong Data Center Growth
- Strong Performance: MACOM Technology achieved revenue of $271.6 million in Q1 2026, reflecting a 4% sequential increase and a 24.5% year-over-year growth, indicating robust market demand and record backlog, showcasing the company's solid performance across all markets.
- Data Center Growth: CEO Stephen Daly noted that Data Center revenue is projected to achieve a year-over-year growth rate of 35% to 40%, driven by robust capital investments from hyperscalers, which is boosting demand for the company's 800 and 1.6T optical and high-speed analog products, thereby strengthening its market position.
- Margin Improvement: The adjusted gross profit for Q1 was $156.5 million, representing 57.6% of revenue, while adjusted operating income reached $74 million, demonstrating the company's ongoing improvements in cost control and operational efficiency, which enhances confidence in future profitability.
- Outlook: Daly expects Q2 revenue to range between $281 million and $289 million, with adjusted gross margins projected between 57% and 59%, indicating a positive outlook for future growth, particularly in the expanding Data Center and Telecom markets.
See More
MACOM Technology Q1 Earnings Exceed Expectations
- Strong Performance: MACOM Technology reported a Q1 non-GAAP EPS of $1.02, beating expectations by $0.02, indicating a sustained enhancement in profitability and reflecting its competitive position in the market.
- Revenue Growth: The company achieved revenue of $271.6 million in Q1, representing a 24.5% year-over-year increase, surpassing market expectations by $2.58 million, showcasing MACOM's success in demand growth and market share expansion.
- Stable Gross Margin: The adjusted gross margin was 57.6%, slightly up from 57.5% in the previous year, demonstrating ongoing improvements in cost control and operational efficiency, which helps bolster investor confidence.
- Positive Outlook: MACOM expects Q2 revenue to range between $281 million and $289 million, exceeding the market consensus of $275.73 million, with adjusted EPS projected between $1.05 and $1.09, further solidifying market optimism regarding its future growth.
See More
Macom Technology Exceeds Q1 Earnings Expectations
- Significant Earnings Growth: Macom Technology reported a 29% year-over-year increase in adjusted EPS to $1.02 and a 24.5% rise in revenue to $271.6 million for the first quarter ended January 2, exceeding analyst expectations and demonstrating strong performance in the semiconductor market.
- Improved Gross Margin: The company's gross margin for the first quarter was 55.9%, up from 53.7% in the same quarter last year and 54.5% in the previous quarter, indicating effective cost control and pricing strategies that enhance profitability.
- Optimistic Q2 Outlook: Macom expects revenue for the second quarter to range between $281 million and $289 million (midpoint at $285 million), surpassing the consensus estimate of $275.73 million, reflecting confidence in future growth.
- Adjusted EPS Forecast: The company anticipates adjusted EPS for the second quarter to be between $1.05 and $1.09 (midpoint at $1.07), also above the consensus estimate of $1.03, further showcasing its ongoing profitability and competitive position.
See More
MACOM Technology Set to Announce Q1 Earnings on February 5th
- Earnings Announcement: MACOM Technology is scheduled to release its Q1 earnings report on February 5th before the market opens, with a consensus EPS estimate of $1.00, reflecting a 26.6% year-over-year increase, indicating sustained profitability.
- Revenue Growth Expectations: The revenue estimate for the first quarter stands at $269.02 million, representing a 23.3% year-over-year growth, showcasing MACOM's steady sales increase amid strong market demand.
- Performance Beat Record: Over the past two years, MACOM has beaten EPS estimates 88% of the time and revenue estimates 100% of the time, demonstrating the company's consistency and reliability in financial performance.
- Revision Trends: In the last three months, EPS estimates have seen 12 upward revisions and 1 downward revision, while revenue estimates have experienced 13 upward revisions with none downward, reflecting analysts' optimistic outlook on the company's future performance.
See More
