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Microchip Technology Inc
MCHP : NASDAQ : Technology
$47.11 -1.77 | -3.62%
Today's Range: 47.05 - 48.62
Avg. Daily Volume: 1,472,200
07/23/14 - 4:00 PM ET

Financial Analysis


MICROCHIP TECHNOLOGY INC's gross profit margin for the fourth quarter of its fiscal year 2013 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. MICROCHIP TECHNOLOGY INC is extremely liquid. Currently, the Quick Ratio is 4.72 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has increased by 10.44% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q4 FY13 Q4 FY12
Net Sales ($mil)493.38430.14
EBITDA ($mil)172.89127.56
EBIT ($mil)127.4563.94
Net Income ($mil)111.559.69


Balance Sheet Q4 FY13 Q4 FY12
Cash & Equiv. ($mil)1344.791578.6
Total Assets ($mil)4067.633851.41
Total Debt ($mil)1020.76983.39
Equity ($mil)2135.461933.47


Profitability Q4 FY13 Q4 FY12
Gross Profit Margin63.7961.08
EBITDA Margin35.0429.65
Operating Margin25.8314.86
Sales Turnover0.470.41
Return on Assets9.713.3
Return on Equity18.516.58
Debt Q4 FY13 Q4 FY12
Current Ratio5.866.55
Debt/Capital0.320.34
Interest Expense11.969.93
Interest Coverage10.666.44


Share Data Q4 FY13 Q4 FY12
Shares outstanding (mil)200.0196.47
Div / share0.360.35
EPS0.50.28
Book value / share10.689.84
Institutional Own % n/a n/a
Avg Daily Volume1456668.02009068.0

Valuation


BUY. The current P/E ratio indicates a discount compared to an average of 30.43 for the Semiconductors & Semiconductor Equipment industry and a premium compared to the S&P 500 average of 19.42. Conducting a second comparison, its price-to-book ratio of 4.51 indicates a significant premium versus the S&P 500 average of 2.68 and a premium versus the industry average of 3.83. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
MCHP 26.60 Peers 30.43   MCHP 14.23 Peers 16.46

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

MCHP is trading at a discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

MCHP is trading at a discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
MCHP 15.63 Peers 18.96   MCHP 0.52 Peers 1.16

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

MCHP is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

MCHP trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
MCHP 4.51 Peers 3.83   MCHP 196.72 Peers 75.60

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

MCHP is trading at a premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

MCHP is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
MCHP 4.99 Peers 3.96   MCHP 22.10 Peers 12.42

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

MCHP is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

MCHP has a sales growth rate that significantly exceeds its peers.

 

 

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