Allegro MicroSystems Inc Post Earnings Pullback Provides Attractive Buying Oppty; Buy, $55 PT

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Allegro MicroSystems Inc Post Earnings Pullback Provides Attractive Buying Oppty; Buy, $55 PT

Global Research

30 July 2026ab

Allegro MicroSystems Inc Equities

AmericasPost Earnings Pullback Provides Attractive Buying

Oppty; Buy, $55 PT Semiconductors

12-month rating Buy

12m price target US$55.00Summary

ALGM's EPS guidance is being slightly pinched in the near-term by its decision to

accelerate discretional spend, but we remain buyers on this pullback because this model Price (30 Jul 2026) US$40.64

has several levers of upside as we move forward and the stock should be able to RIC: ALGM.O BBG: ALGM US

command a premium multiple given its growth profile. Trends in its autos business

remain strong with orders growing ahead of where ALGM is guiding revenue in the Trading data and key metrics

segment, while the industrial business should really start to compound growth as new 52-wk range US$69.62-22.80

factory automation/robotics applications layer on top of its data center exposure which Market cap. US$7.55b

is the highest among any of its analog peers. Net, we are adjusting some of our margin Shares o/s 186m (COM)

expectations a bit lower due to discretionary spending, but we remain well above the Free float 46%

Street at $1.60 and $2.33 for C2027 and C2028 EPS, respectively, and we roll forward Avg. daily volume ('000) 2,988

our PT 6mos to C2028 (avg 2027/2028 prior) and continue to apply a ~25x multiple as Avg. daily value (m) US$155.3

we believe ALGM's premium growth profile warrants a premium (~10%) to peer Common s/h equity (03/27E) US$1.11b

multiples. We reiterate Buy, and ALGM remains one of our top SMID ideas across our P/BV (03/27E) 7.1x

coverage. Net debt to EBITDA (03/27E) NM

Analysis/Key Highlights EPS (UBS, diluted) (USD)

03/27E