Should I Buy ALGM? ALGM 2026 Analysis

Should You Buy Allegro Microsystems Inc (ALGM) Today? Analysis, Price Targets, and 2026 Outlook.

Conclusion

Hold

Latest Price

41.570

1 Day change

7.64%

52 Week Range

41.780

Analysis Updated At

2026/02/04

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Not a good buy right now for an impatient investor: the stock is technically extended (RSI ~80) after a sharp move and is near a key resistance zone.
Momentum/trend is bullish, but the near-term statistical pattern points to mild downside over 1 day/1 week/1 month, which is not ideal for an immediate entry.
Insider activity is a notable negative (selling up ~129.7% last month), suggesting limited urgency to chase here.

Intellectia Proprietary Trading Signals

AI Stock Picker: No signal on given stock today.
SwingMax: No signal on given stock today.

Technical Analysis

Trend: Bullish structure (SMA_5 > SMA_20 > SMA_200) confirms an uptrend.
Momentum: MACD histogram positive and expanding (bullish), but the move is stretched.
Overbought: RSI_6 = 80.19 indicates overbought conditions—often followed by consolidation/pullback.
Levels: Pivot ~35.64 (important support zone). Near-term resistance: R1 ~38.71 (already exceeded/being tested) and next resistance R2 ~40.60.
Near-term bias: With price ~38.84 sitting close to resistance and overbought, risk/reward for a fresh buy is unattractive today.

Options Data

Bearish

Open Interest Put-Call Ratio

Bullish

Option Volume Put-Call Ratio

Positioning/sentiment split: Put open interest is extremely heavy versus calls (OI P/C 7.23) → suggests substantial hedging/protection demand or bearish positioning in outstanding contracts.
Flow today leans more bullish: volume P/C 0.46 (more calls than puts on the day).
Volatility: 30D IV ~58.1 vs historical vol ~46.5; IV percentile ~68.8 → options pricing implies elevated uncertainty/expectations after the earnings move.
Activity: Today’s volume is elevated vs 30D average (12.53x), consistent with post-event repositioning.

Technical Summary

Sell

Buy

Positive Catalysts

- Earnings-driven momentum: Q3 results highlighted ~~29% YoY sales growth and non-GAAP EPS beat (~~$0.15 vs ~$0.14 expected).
- Demand narrative: strength cited in EV and data center exposure (data center angle viewed as incremental upside by analysts).
- Wall Street support: multiple price target raises and reiterated Buy/Overweight/Outperform ratings after the report.

Neutral/Negative Catalysts

- Technically overheated: RSI overbought plus proximity to resistance increases odds of near-term pullback/consolidation.
- Insider selling rising: insiders are net sellers, with selling amount up ~129.7% over the last month.
- Financial optics: GAAP net income and GAAP EPS fell sharply YoY in the latest quarter despite revenue growth (headline profitability deterioration can cap near-term upside).
- Macro/sector headwind noted by analysts: EV demand volatility and launch delays/cancellations discussed as a 2026 headwind for parts of the auto/EV supply chain.
- Pattern-based forecast provided: similar candlestick analogs imply modest negative drift over the next day/week/month.

Financial Performance

Latest quarter: 2026/Q3.
Revenue: $229.21M, up +28.86% YoY (strong top-line growth).
Gross margin: 46.73%, up +2.34% YoY (improving product/mix economics).
Profitability (GAAP): Net income $8.30M, down -220.98% YoY; EPS $0.04, down -200% YoY (despite strong sales—suggests cost/one-time/expense pressure).
Market takeaway: growth is clearly accelerating, but the quarter shows mixed quality due to the sharp GAAP earnings decline.

Growth

Profitability

Efficiency

Analyst Ratings and Price Target Trends

Recent trend: decisively more bullish post-earnings—multiple firms raised price targets and reiterated positive ratings.
Key changes (Jan 30, 2026 cluster): Mizuho PT to $44 (Outperform), TD Cowen PT to $45 (Buy), UBS PT to $44 (Buy), Barclays PT to $46 (Overweight) citing auto growth and optionality from data center.
Earlier updates: BofA raised PT to $39 (Buy) on broader analog/industrial rebound expectations; Wells Fargo added ALGM to Tactical Ideas list (Overweight, PT $40) ahead of potential catalyst events.
Wall Street pros: beat-and-raise tone, design wins, auto strength, emerging data center narrative.
Wall Street cons: costs/expense pressure noted; EV demand volatility remains a risk factor.
Politicians/congress/influential trading: no recent congress trading data available.

7 Analyst Rating

Wall Street analysts forecast ALGM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for ALGM is 39.14 USD with a low forecast of 35 USD and a high forecast of 49 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.

7 Buy

0 Hold

0 Sell

Strong Buy

Current: 38.620

Low

Averages

39.14

High

Current: 38.620

Low

Averages

39.14

High

Mizuho

NULL -> Outperform

maintain

$38 -> $44

AI Analysis

2026-01-30

Reason

Mizuho

Price Target

$38 -> $44

AI Analysis

2026-01-30

maintain

NULL -> Outperform

Reason

Mizuho raised the firm's price target on Allegro MicroSystems to $44 from $38 and keeps an Outperform rating on the shares. The company reported good December quarter results, the analyst tells investors in a research note.

TD Cowen

Buy

upgrade

$38 -> $45

2026-01-30

Reason

TD Cowen

Price Target

$38 -> $45

2026-01-30

upgrade

Buy

Reason

TD Cowen raised the firm's price target on Allegro MicroSystems to $45 from $38 and keeps a Buy rating on the shares. The firm said they posted a clean revenue beat and raise with design wins across the portfolio.

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ALGM Should I Buy

ALGM Should I Buy

Should You Buy Allegro Microsystems Inc (ALGM) Today? Analysis, Price Targets, and 2026 Outlook.

Technical Analysis

Options Data

Technical Summary

Positive Catalysts

Neutral/Negative Catalysts

Financial Performance

Growth

Profitability

Efficiency

Analyst Ratings and Price Target Trends

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