Cantor Fitzgerald Initiates Coverage of Microchip Technology (MCHP) Stock, Gives Neutral

Microchip Technology Incorporated (NASDAQ:MCHP) is one of the 10 Worst Aggressive Growth Stocks to Buy According to Short Sellers. On June 18, Cantor Fitzgerald analyst Matthew Prisco began coverage of Microchip Technology Incorporated (NASDAQ:MCHP)’s stock with a “Neutral” rating and a price objective of $70. The firm highlighted the positive developments in the company’s efforts to improve business operations, mentioning that gross margin expansion over the upcoming quarters can offer a meaningful upside for Microchip Technology Incorporated (NASDAQ:MCHP).

A semiconductor wafer at various stages of fabrication, showing the company’s range of expertise.

The firm cited Microchip Technology Incorporated (NASDAQ:MCHP)’s preferential exposure to the industrial sector as a positive factor. This measure keeps the risk biased to the upside, suggesting that the firm will take a long position in the near term, despite a neutral rating. For Q1 2026, Microchip Technology Incorporated (NASDAQ:MCHP) expects consolidated net sales of between $1.045 billion and $1.070 billion. Earlier, it provided guidance of consolidated net sales of between $1.025 billion and $1.070 billion.

Microchip Technology Incorporated (NASDAQ:MCHP)’s bookings activity for May continues to track higher than any month over the last two years. The company is confident in the recovery of its business as it executes on its strategic initiatives, reduces inventory levels, and makes progress towards its long-term business model. ClearBridge Investments, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:

“Also within the IT sector, we added Microchip Technology Incorporated (NASDAQ:MCHP), which supplies analog and mixed-signal microprocessors for use in the automotive, industrial, computing and other industries. We took advantage of recent weakness in the stock to add to the position. We believe that the return of the company’s prior CEO and efforts to rebuild relationships with customers has resulted in Microchip recovering market share to prior levels, and that it represents an attractive cyclical improvement story with asset optimization improvements and good business visibility.”

While we acknowledge the potential of MCHP to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MCHP and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.