Semtech bounces ahead of planned $350 mln convertible bonds sale
07/10/2025 16:00
** Semiconductor supplier Semtech's SMTC.O shares up 7.8% at $73.47 on Tues, looking to snap two-session losing streak, as co seeks capital raise to refinance debt ** Camarillo, California-based firm late Mon announced private offering of $350 mln 0% convertible bonds (CBs) due 2030 ** It plans to use net offering proceeds, together with its common shares, for exchanges of its 1.625% CBs due 2027 and its 4% CBs due 2028, and repay a portion of term loans ** It also intends to use a portion of proceeds to pay cost of capped calls, derivative transactions employed to help offset potential dilution ** Co has about $6.6 bln current market cap ** With move on the session, SMTC up ~19% YTD, in line with nearly 19% rise in the Nasdaq .IXIC ** TD Cowen last week initiated coverage with 'buy' rating and a $75 PT, saying Semtech is "well aligned with our datacenter connectivity framework as its deep expertise in mixed-signal and analog solutions enables well-diversified exposure in datacenter, telco, smartphone/wearables, and industrial IoT end markets" ** Of 16 analysts covering SMTC, recommendation breakdown is 14 "strong buy" or "buy" and 2 "hold"; median PT is $67.50, per LSEG data (Lance Tupper is a Reuters market analyst. The views expressed are his own) ((lance.tupper@tr.com 1-646-279-6380))