Semtech Corporation (SMTX) is gearing up to report third-quarter earnings after the close on Monday, and Wall Street is expecting a pretty solid quarter from the Camarillo, California-based semiconductor company.
The consensus among analysts calls for earnings of 45 cents per share, which would mark a nice jump from the 26 cents per share Semtech posted in the same period last year. On the revenue front, analysts are looking for $266.42 million, compared to $236.8 million a year earlier.
It's worth noting that Semtech made some moves on the capital side recently. Back on October 8, the company announced it was pricing a private offering of $350 million in new convertible senior notes while also exchanging some existing notes. The kind of financial engineering companies do to optimize their balance sheets.
Shares closed Thursday at $62.57, down 3% for the session. But looking at recent analyst activity, there's clearly some optimism building around the stock heading into earnings.
What the Top Analysts Are Saying
Several of the Street's most accurate analysts have been updating their views on Semtech lately, and the trend has been decidedly positive. Here's what the top-rated analysts have been forecasting:
Piper Sandler's Harsh Kumar, who sports an impressive 84% accuracy rate, maintained an Overweight rating back on August 26 and lifted his price target from $55 to $65.
Benchmark's Cody Acree, with an 82% accuracy rate, kept his Buy rating on September 9 and bumped his target from $68 to $76.
Over at Oppenheimer, Rick Schafer made perhaps the most notable move on September 30, upgrading Semtech from Perform to Outperform with an $81 price target. This analyst carries an 80% accuracy rate.
UBS analyst Timothy Arcuri, accurate 81% of the time, maintained a Buy rating on October 27 and raised his target from $65 to $85, marking one of the highest price targets on the Street for the stock.
Most recently, on November 18, Susquehanna's Christopher Rolland kept his Positive rating intact while increasing his price target from $65 to $80. Rolland has a 77% accuracy rate.
The pattern is clear: analysts with strong track records have been steadily raising their expectations for Semtech over the past few months, with price targets now clustering in the $65 to $85 range. Monday's earnings report will show us whether that optimism is justified.
