Fact based stock research
Semtech (NasdaqGS:SMTC)

US8168501018

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Semtech stock research in summary

semtech.com

ANALYSIS: With an Obermatt Combined Rank of 57 (better than 57% compared with investment alternatives), Semtech (Semiconductors, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Semtech are a good value (attractively priced) with a consolidated Value Rank of 51 (better than 51% of alternatives), show above-average growth (Growth Rank of 100) but are riskily financed (Safety Rank of 9), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 57, is a buy recommendation based on Semtech's financial characteristics. As the company Semtech's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 51) and above-average growth (Obermatt Growth Rank of 100), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 9) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	51
Growth Rank	100
Safety Rank	9
Combined Rank	57

Country	USA
Industry	Semiconductors
Index	NASDAQ, S&P MIDCAP
Size class	Medium

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Semtech

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	29	39	51
GROWTH
GROWTH	55	41	3	100
SAFETY
SAFETY	44	61	47	9
SENTIMENT
SENTIMENT	n/a	92	35	^new
360° VIEW
360° VIEW	n/a	69	14	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 28-Jul-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Semtech is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	17	29	39	51
GROWTH
GROWTH	55	41	3	100
SAFETY
SAFETY	44	61	47	9
COMBINED
COMBINED	19	29	9	57

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Semtech the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% compared with alternatives), Semtech shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators where three out of four are below average for Semtech. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 98, which means that the stock price is lower compared with invested capital than for 98% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 41 which means the stock price compared with what market professionals expect for future profits is higher than 59% of comparable companies, indicating a low value concerning Semtech's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 98 and for the dividend yields rank which is lower than for 99% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a buy recommendation based on Semtech's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Semtech, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	40	39	75	41
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	46	44	25	41
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	35	42	38	98
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	17	29	39	51

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Semtech; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 100 (better than 100% compared with alternatives) for 2024, Semtech shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Semtech. Sales Growth has a value of 76, which means that, currently, professionals expect the company to grow more than 76% of its competitors. The same is valid for Profit Growth with a value of 98 and for Capital Growth with 91. In addition, Stock Returns had an above-average rank value of 100, which means they have been higher than 100% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 100, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Semtech exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	34	46	16	76
PROFIT GROWTH
PROFIT GROWTH	10	58	8	98
CAPITAL GROWTH
CAPITAL GROWTH	n/a	41	18	91
STOCK RETURNS
STOCK RETURNS	67	45	21	100
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	55	41	3	100

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Semtech.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 9 (better than 9% compared with alternatives), the company Semtech has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Semtech is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Semtech. Liquidity is at 33, meaning that the company generates less profit to service its debt than 67% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 1, meaning the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. Finally, Refinancing is at a rank of 35 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 65% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 9 (worse than 91% compared with alternatives), Semtech has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Semtech because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	53	60	10	1
REFINANCING
REFINANCING	39	29	71	35
LIQUIDITY
LIQUIDITY	57	70	55	33
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	44	61	47	9

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Semtech and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	85	84	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	98	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	98	1	^new
MARKET PULSE
MARKET PULSE	n/a	54	1	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	92	35	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Semtech.
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