Allegro Microsystems Intrinsic Value Calculation – Mobileye Worries Push Allegro MicroSystems Stock Down
January 5, 2024
🌧️Trending News
Today, Allegro ($NASDAQ:ALGM) MicroSystems’ stock price has taken a hit due to worries surrounding Mobileye, a provider of advanced driver assistance systems. Mobileye is an Israeli-based technology company that is a major contributor to the automotive industry, and its concerns have caused Allegro’s stock to decline. The company’s products are used in electric, hybrid, and internal combustion engine-powered vehicles, as well as in motor controls, motion control systems, and other industrial applications. Allegro MicroSystems‘ products have been adopted by numerous major automotive manufacturers and suppliers, and its stock is traded on the NASDAQ exchange. The recent worries surrounding Mobileye have caused Allegro’s stock to take a hit.
The market has been concerned that the company’s driver assistance technology may no longer be adopted by automotive companies if the Mobileye worries cause further delays in getting their products to market. This could have a significant impact on Allegro’s business, as it relies heavily on its automotive customers for revenue. As a result, investors have become increasingly concerned about the company’s future prospects and its stock price has been affected accordingly.
Stock Price
On Thursday, ALLEGRO MICROSYSTEMS stock opened at $27.8 but ended the day at $27.2, representing a 6.4% drop from the last closing price of $29.0. This decrease in stock value was attributed to worries about Mobileye, a company ALLEGRO MICROSYSTEMS supplies components to. Investors were concerned that Mobileye’s recent issues would affect ALLEGRO MICROSYSTEMS’ financial performance. As a result, ALLEGRO MICROSYSTEMS stock took a hit. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Allegro Microsystems. More…
| Total Revenues | Net Income | Net Margin |
| 1.07k | 252.96 | 23.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Allegro Microsystems. More…
| Operations | Investing | Financing |
| 197.79 | -104.67 | -21.17 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Allegro Microsystems. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.28k | 186.65 | 5.7 |
Key Ratios Snapshot
Some of the financial key ratios for Allegro Microsystems are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 22.3% | 79.6% | 26.6% |
| FCF Margin | ROE | ROA |
| 7.2% | 16.8% | 13.9% |
Analysis – Allegro Microsystems Intrinsic Value Calculation
At GoodWhale, we have conducted a detailed analysis of ALLEGRO MICROSYSTEMS‘ financials. Our proprietary Valuation Line has calculated that the fair value of ALLEGRO MICROSYSTEMS’ share is around $39.0. However, the current trading price of ALLEGRO MICROSYSTEMS’ stock is $27.2, representing a 30.3% undervaluation. This presents an opportunity for investors to buy ALLEGRO MICROSYSTEMS’ stock at a discounted price and potentially generate higher returns than the market. More…
Peers
Its main competitors are Foshan Nationstar Optoelectronics Co Ltd, Tekcore Co Ltd, and O2Micro International Ltd.
– Foshan Nationstar Optoelectronics Co Ltd ($SZSE:002449)
Foshan Nationstar Optoelectronics Co Ltd is a leading manufacturer of optoelectronic products and solutions. The company has a market cap of 5.14B as of 2022 and a return on equity of 3.64%. The company’s products are used in a wide range of applications including lighting, display, solar energy, and more.
– Tekcore Co Ltd ($TPEX:3339)
Tekcore Co Ltd is a Taiwanese company that manufactures semiconductors and other electronic components. It has a market capitalization of 635.06 million as of 2022 and a return on equity of 5.91%. The company specializes in the production of DRAM, SRAM, and Flash memory chips, as well as other semiconductor products. It is one of the largest suppliers of memory chips to the global market.
– O2Micro International Ltd ($NASDAQ:OIIM)
O2Micro International Ltd. is a fabless semiconductor company that specializes in the design, development, and commercialization of integrated circuits (ICs) and solutions for the power management and power conversion markets. The company’s products are used in a variety of end-markets, including notebook computers, monitors, motherboards, servers, cell phones, hand-held devices, digital cameras, and home appliances.
O2Micro International Ltd. has a market capitalization of $125.21 million as of March 2021 and a return on equity of 6.96%. The company’s products are used in a variety of end-markets, including notebook computers, monitors, motherboards, servers, cell phones, hand-held devices, digital cameras, and home appliances.
Summary
Allegro MicroSystems is a semiconductor company that designs, develops, and markets high-performance power and sensors integrated circuits. Analysts are concerned that Intel’s entrance to the market may put Allegro at a competitive disadvantage, as Intel has greater resources and market presence. Investors may want to consider their risk tolerance before investing in Allegro MicroSystems at this time, as there are still risks regarding the Mobileye acquisition.
However, Allegro’s strong long-term fundamentals may make it a good investment for those seeking a long-term return. It is important to further research the company’s financials and future plans before investing.
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