Microchip Technology Incorporated (MCHP)

FairStock Score: 36/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look first for a business that earns good returns and can survive cycles, then for a price that leaves room for error. Microchip’s filings show a deeply cyclical semiconductor business: in fiscal 2024, the year ended 2024-03-31, revenue was $7.6B, net income $1.9B, and diluted EPS $3.48. By fiscal 2025, the year ended 2025-03-31, revenue fell to $4.4B and net income was a loss of $0.5M, or EPS -$0.01. Fiscal 2026, ended 2026-03-31, improved to revenue $4.7B, net income $230.0M, and EPS $0.22. In fiscal Q1 2027, the quarter ended 2026-06-30, revenue was $1.5B, net income $229.8M, and diluted EPS $0.37—a sharp rebound and the basis for FairStock’s TURNAROUND category. Financial health looks adequate: trailing FCF $1.1B, FCF yield 2.7%, D/E 0.84, and FairStock’s Piotroski 7/9 and Altman Z 3.79. But returns are not yet attractive—ROE 7.19% and ROCE 3.54%—and the moat is not visible enough in these numbers to pay almost any price. At the 2026-10-26 close of $75.90, FairStock shows P/E 111.62, P/B 6.39, EV/EBITDA 31.05, and Graham Number $13.48, implying a -449.33% margin of safety. That is not Graham’s bargain; it is a recovery bet. I would wait for evidence that normalized earnings and returns return before calling it cheap.

In plain English: Microchip Technology makes specialized chips used in cars, factories, and many electronic devices. The business has swung from a loss back to a profit, and recent sales are higher, but profits are still far below where they were a couple of years ago. At $75.90 on 2026-10-26, the price looks expensive against current earnings and asset value, so it appears to need a lot of future recovery to justify.

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Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q1 2027 10-Q (period ended 2026-06-30) · fiscal Q3 2026 10-Q (period ended 2025-12-31) · fiscal Q2 2026 10-Q (period ended 2025-09-30) · fiscal Q1 2026 10-Q (period ended 2025-06-30) · FY2026 10-K (period ended 2026-03-31) · FY2025 10-K (period ended 2025-03-31) · FY2024 10-K (period ended 2024-03-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer