No Heroic Bounce-Back In Store For Semtech's Protection And Sensing Segment, Analyst Revises Price Target Ahead Of Q1

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  • Susquehanna analyst Christopher Rolland reiterated a Neutral rating on the shares of Semtech Corporation SMTClowering the price target to $25 from $30.
  • Semtech will report the first quarter of fiscal year 2024 earnings after the close on Wednesday, June 7.
  • The analyst expects inline results and softer guidance in the quarter to be reported. 
  • On the last call, management suggested a 2H rebound, but the analyst sees a more muted recovery.
  • The consumer market may be bottoming, but the analyst does not expect a "heroic bounce-back" in the Protection and Sensing segment in 2H. 
  • The analyst notes that Semtech may also bear the brunt of pricing pressure on LoRa products from cheaper NB-IoT solutions and integration risks with Sierra Wireless.
  • The analyst also expects Advanced Protection and Sensing segment to bottom but with slower recovery. 
  • The analyst notes that Readthroughs for Advanced Protection and Sensing were weak, as 1Q smartphone shipments and 2Q forecasts were disappointing (improving much slower than originally anticipated).
  • For Q1, the analyst expects revenues of $234.12 million. EPS loss estimates widened to $(0.08) from the prior expectation of $(0.07) loss.
  • Price Action: SMTC shares are trading higher by 2.85% to $22.36 on the last check Thursday.
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Posted In: Analyst ColorEquitiesNewsPrice TargetReiterationSmall CapMarketsAnalyst RatingsGeneralBriefsExpert Ideas
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