Chip designer Allegro MicroSystems (NASDAQ: ALGM) will be reporting results this Thursday morning. Here’s what you need to know.
Allegro MicroSystems beat analysts’ revenue expectations by 4.3% last quarter, reporting revenues of $192.8 million, down 19.9% year on year. It was a very strong quarter for the company, with a significant improvement in its inventory levels and an impressive beat of analysts’ EPS estimates.
Is Allegro MicroSystems a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Allegro MicroSystems’s revenue to grow 18.6% year on year to $197.9 million, a reversal from the 40% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.08 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Allegro MicroSystems has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.4% on average.
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. Qorvo’s revenues decreased 7.7% year on year, beating analysts’ expectations by 5.3%, and Penguin Solutions reported revenues up 7.9%, falling short of estimates by 1.4%. Penguin Solutions traded up 10.6% following the results.
Read our full analysis of Qorvo’s results here and Penguin Solutions’s results here.
There has been positive sentiment among investors in the processors and graphics chips segment, with share prices up 4.6% on average over the last month. Allegro MicroSystems’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $35.42 (compared to the current share price of $34.01).
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