Microchip tumbles after weak margin forecast, bucks chip-sector gains

Microchip Technology

Yesterday 15:17

Updates
   ** Shares of US semiconductor supplier Microchip MCHP.O fall 8.33% to $59.5, on track for their worst day since June as concerns over its margin outlook outweigh a broader chip-sector rebound
** Co on Thursday forecast gross margin of 64% to 65% in Q3, below analysts' mean estimate of 66.2% — data compiled by LSEG
** Supply limitations are constraining the outlook, CEO Steve Sanghi said, as bottlenecks at foundries, assembly and test partners, and internal operations leave some orders unfilled
** At least 12 brokerages cut PTs; JPM lowered its PT to $100 from $120, citing supply constraints and higher costs that are limiting margin expansion despite healthy demand
** 14 out of 27 analysts rate the stock as "buy", 7 as "strong buy" and 6 "hold"; their median PT is $88 — LSEG
** Including session move, stock has fallen 6.5% YTD

 (Reporting by Anjana J Nair)
 ((AnjanaJayakrishnan.Nair@thomsonreuters.com))