Analog Semiconductors Stocks Q1 Highlights: Microchip Technology (NASDAQ:MCHP)

As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at analog semiconductors stocks, starting with Microchip Technology MCHP.

Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.

The 15 analog semiconductors stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.5% while next quarter’s revenue guidance was 5.7% above.

Luckily, analog semiconductors stocks have performed well with share prices up 11.4% on average since the latest earnings results.

Spun out from General Instrument in 1987, Microchip Technology MCHP is a leading provider of microcontrollers and integrated circuits used mainly in the automotive world, especially in electric vehicles and their charging devices.

Microchip Technology reported revenues of $1.31 billion, up 35.1% year on year. This print exceeded analysts’ expectations by 3.8%. Overall, it was a stunning quarter for the company with a beat of analysts’ EPS estimates and revenue guidance for next quarter exceeding analysts’ expectations.

"Our March quarter results significantly exceeded our expectations, with revenue of $1.311 billion coming in above the high end of our guidance and increasing 10.6% sequentially and 35.1% year over year, reflecting broad‑based improvement across Microchip’s business," said Steve Sanghi, Microchip’s President and Chief Executive Officer.

Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 9.8% since reporting and currently trades at $91.60.

Headquartered in Dallas, Texas since the 1950s, Texas Instruments TXN is the world’s largest producer of analog semiconductors.

Texas Instruments reported revenues of $4.83 billion, up 18.6% year on year, outperforming analysts’ expectations by 6.6%. The business had a stunning quarter with a beat of analysts’ EPS and operating income estimates.

Texas Instruments delivered the biggest analyst estimate beat among its peers. The market seems happy with the results as the stock is up 26.2% since reporting. It currently trades at $298.22.

Slowest Q1: Universal Display OLED

Serving major consumer electronics manufacturers, Universal Display OLED is a provider of organic light emitting diode (OLED) technologies used in display and lighting applications.

Universal Display reported revenues of $142.2 million, down 14.5% year on year, falling short of analysts’ expectations by 11%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.

Universal Display delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is flat since the results and currently trades at $86.90.

Read our full analysis of Universal Display’s results here.

Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings ST is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.

Sensata Technologies reported revenues of $934.8 million, up 2.6% year on year. This result surpassed analysts’ expectations by 0.8%. Zooming out, it was a satisfactory quarter as it also recorded a beat of analysts’ EPS estimates and revenue guidance for next quarter meeting analysts’ expectations.

Sensata Technologies had the weakest guidance update among its peers. The stock is up 14.8% since reporting and currently trades at $47.69.

Read our full, actionable report on Sensata Technologies here, it’s free.

Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems MPWR is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.

Monolithic Power Systems reported revenues of $804.2 million, up 26.1% year on year. This print beat analysts’ expectations by 2.8%. It was a very strong quarter as it also produced revenue guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ operating income estimates.

The stock is down 14.6% since reporting and currently trades at $1,379.

Read our full, actionable report on Monolithic Power Systems here, it’s free.