Allegro MicroSystems (ALGM) Reports Q4: Everything You Need To Know Ahead Of Earnings

Jabin Bastian /
2023/05/09 4:26 am EDT

Chip designer Allegro MicroSystems (NASDAQ:ALGM) will be announcing earnings results tomorrow after the bell. Here's what to look for.

Last quarter Allegro MicroSystems reported revenues of $248.8 million, up 33.3% year on year, beating analyst revenue expectations by 1.58%. It was a very strong quarter for the company, with a beat on the bottom line and a significant improvement in operating margin.

Is Allegro MicroSystems buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Allegro MicroSystems's revenue to grow 32.3% year on year to $265.0 million, improving on the 14.4% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.36 per share.

Allegro MicroSystems Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 3.82%.

Looking at Allegro MicroSystems's peers in the processors and graphics chips segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. SMART's revenues decreased 4.45% year on year, missing analyst estimates by 1.34% and Qualcomm reported revenue decline of 16.9% year on year, exceeding estimates by 1.73%. SMART traded down 3.44% on the results, Qualcomm was down 2.07%. Read our full analysis of SMART's results here and Qualcomm's results here.

The fears around raising interest rates have been putting pressure on tech stocks and while some of the processors and graphics chips stocks have fared somewhat better, they have not been spared, with share price declining 6.49% over the last month. Allegro MicroSystems is down 18.7% during the same time, and is heading into the earnings with analyst price target of $51, compared to share price of $37.55.

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The author has no position in any of the stocks mentioned.