Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Microchip Technology (NASDAQ: MCHP ) , a manufacturer of semiconductor products for embedded control applications, jumped as much as 10% after reporting better-than-expected fourth-quarter results and guiding its first-quarter forecast above the consensus.
So what: For the quarter, Microchip relied heavily on sales of its microcontroller products. Sales of these devices, used in smartphones and tablets, rose 22% for the quarter and accounted for close to two-thirds of Microchip's total revenue. Total profit came in at $0.41 for the quarter, $0.04 ahead of the Street's expectation. Looking ahead, Microchip forecast sales growth of 1%-4%, or an implied $420 million to $433 million in revenue, on $0.45-$0.49 in EPS for the first quarter. Both figures easily trump the $417.8 million and $0.42 that Wall Street projected.
Now what: As long as smartphones and tablets remain popular, Microchip's microcontroller sales will continue to grow in importance to the company. Don't also negate that Microchip pays out a considerable portion of its profits as a dividend to shareholders, signaling confidence from management that cash flow should remain strong for quite some time. I can definitely see why shares are higher today and why long-term investors are excited about this company and would encourage tech-savvy investors to dig a bit deeper into Microchip Technology.
Craving more input? Start by adding Microchip Technology to your free and personalized watchlist so you can keep up on the latest news with the company.
A hidden gem in the tech sector?
The amount of data we store every year is growing by a mind-boggling 60% annually! To make sense of this trend and pick out a winner, The Motley Fool has compiled a new report called "The Only Stock You Need to Profit From the NEW Technology Revolution." The report highlights a company that has gained 300% since first recommended by Fool analysts but still has plenty of room left to run. Thousands have requested access to this special free report, and now you can access it today at no cost. To get instant access to the name of this company transforming the IT industry, click here -- it's free.