At the end of February we announced the arrival of the first US recession since 2009 and we predicted that the market will decline by at least 20% in (Recession is Imminent: We Need A Travel Ban NOW). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each […]

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Shares in Microchip Technology (MCHP) surged 7.4% after-hours on Tuesday, after the company boosted its guidance for net sales and earnings for the 2021 fiscal first quarter as Covid-19 disruptions ease.Microchip now expects consolidated net sales for the June quarter to be $1.247 billion – $1.326 billion, or between flat and down 6% sequentially. That’s versus prior guidance of $1.194 billion – $1.3 billion (down between 2% and 10%).GAAP earnings per share is now expected to be between $0.25 and $0.39 and non-GAAP earnings per share is expected to be between $1.35 and $1.53. The original guidance for GAAP earnings per share was $0.13 to $0.31 with non-GAAP at $1.25 to $1.45.“With two months of the quarter behind us, our business is performing better than we expected during our May 7, 2020 earnings conference call. COVID-19 related supply chain disruptions which were primarily in Malaysia and Philippines have eased. We have begun to make up for lost production and expect to continue to gain ground through the end of this quarter,” cheered Steve Sanghi, Microchip’s CEO.“Our customers’ factories in China are fully back to work. Some of our other customers’ factories in Europe and North America have also started to reopen, including automotive factories where we saw the largest demand destruction,” he added.Shares in Microchip are currently trading down 7% year-to-date. However the stock boasts a bullish Strong Buy analyst consensus, with both Mizuho Securities and Rosenblatt reiterating their buy ratings on June 2. (See MCHP stock analysis on TipRanks.)Mizuho’s Vijay Rakesh also ramped up his MCHP price target from $92 to $105 (8% upside potential), citing improving auto-industrial and 5G base station trends after a challenging few months.“We continue to believe MCHP can leverage costs and achieve its target 63% GMs over time, and its broad customer base and product mix are competitive advantages as a potential 2H re-opening positions well from depressed levels” he wrote.Related News: AMD Can Keep the Rally Alive, Says Top Analyst Lyft Rises 5% After-Hours On Strong May Performance MongoDB Earnings Preview: Analysts Looking For Beat, Raise Quarter More recent articles from Smarter Analyst: * Glu Mobile Sinks On $100M Public Offering Announcement * Zoom Lifts Full-Year Sales Guidance As Quarterly Revenue Balloons 169% * Cheesecake Factory Spikes After-Hours As 75% Sales Recaptured * Lyft Rises 5% After-Hours On Strong May Performance

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