Microchip Technology Incorporated (MCHP) Company Bio
Microchip Technology develops, manufactures, and sells semiconductor products for various embedded control applications. The company was founded in 1989 and is based in Chandler, Arizona.
MCHP Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for MCHP, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Microchip Technology Inc ranked in the 52th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. In terms of the factors that were most noteworthy in this DCF analysis for MCHP, they are:
The company's balance sheet shows it gets 72% of its capital from equity, and 28% of its capital from debt. Notably, its equity weight is greater than merely 22.87% of US equities in the Technology sector yielding a positive free cash flow.
Microchip Technology Inc's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than only 0% of US stocks with positive free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
SABR, STMP, CACI, MKSI, and VPG can be thought of as valuation peers to MCHP, in the sense that they are in the Technology sector and have a similar price forecast based on DCF valuation.
To support cloud, data center and hyperscale computing that facilitates advancements in Artificial Intelligence (AI) and Machine Learning (ML), Microchip Technology Inc. (Nasdaq: MCHP) today released to production its Switchtec™ PAX Advanced Fabric Gen 4 PCIe switch family, enabling complex fabric topologies with greater scalability, lower latency, and higher performance than traditional Peripheral Component Interconnect Express (PCIe) switches.
The Senior Secured Notes will bear interest at an annual rate of 2.670 percent and the Senior Notes will bear interest at annual rate of 4.250 percent. Any remaining net proceeds from the offering of the Notes will be used for general corporate purposes, which may include the repayment of a portion of the amounts outstanding under Microchip’s revolving credit facility.
The global case tally from the coronavirus that causes COVID-19 climbed above 5.5 million on Tuesday, as the World Health Organization warned of the possibility of an immediate “second peak” in infections from the current wave, if countries and local governments ease measures to contain the spread too soon.
Moody's Investors Service ("Moody's") affirmed the Ba1 corporate family rating and Baa3 senior secured rating of Microchip Technology Inc. ("Microchip") following the company's announcement that it has agreed to exchange $1.2 billion in aggregate principal amount of senior unsecured convertible notes and fund the cash portion of the exchange with a $1.2 billion senior unsecured note. Concurrently, Microchip is offering a new $1 billion secured note with proceeds partly used to refinance a $615 million, 364 day secured bridge facility. Remaining proceeds may be used to reduce revolving credit outstanding and for general corporate purposes.
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