Microchip Analyst Remains Bullish On The Stock As Backlog & Demand Remain Strong

After the company reaffirmed December quarter guidance, Raymond James analyst Melissa Fairbanks reiterated a Strong Buy rating on Microchip Technology Inc MCHP.
While management is not hosting a call with investors until full results are out, the announcement indicated backlog and demand remain strong, and select components and technologies remain supply constrained.
The current outlook (unchanged) reflects sequential growth between 3-5%. While the company has a history of narrowing the guidance range with mid-quarter updates, she believes the more comprehensive range accounts for some uncertainty, given macro concerns.
Net, she believes MCHP’s PSP program provides reliability high visibility into genuine end market demand, as customers commit only their highest conviction orders to the non-cancellable and non-refundable terms of the agreement, and unsupported backlog reached another record high in the September quarter.
She expects to get additional color regarding current supply and demand dynamics next week when CFO Eric Bjornholt presents at the Raymond James Technology Investors Conference on December 6.
Price Action: MCHP shares traded lower by 0.09% at $74.27 on the last check Tuesday.

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