Eastern Bank has decreased its holdings in Microchip Technology Incorporated (NASDAQ: MCHP) by 17.3% during the second quarter of 2023, according to a report from HoldingsChannel.com. The financial institution now owns 1,675 shares of the semiconductor firm after selling 350 shares during this period. As of the end of the most recent quarter, Eastern Bank’s stake in Microchip Technology was valued at approximately $118,000.
This reduction in holdings is part of a broader trend among institutional investors, several of whom have recently adjusted their positions in MCHP. For instance, Orbis Allan Gray Ltd initiated a new investment in Microchip Technology worth $369.6 million during the first quarter of 2023. Additionally, Invesco Ltd. increased its holdings by 63.0%, acquiring an additional 6,459,123 shares for a total of $808.8 million. Similarly, Goldman Sachs Group Inc. expanded its stake by 138.9%, now holding 8,834,550 shares valued at $427.7 million.
Insider Transactions and Company Performance
In related news, several company insiders have made significant transactions recently. On August 25, Matthew W. Chapman, Director of Microchip Technology, sold 10,000 shares at an average price of $68.25, totaling $682,500. This sale reduced his ownership to 30,665 shares, valued at approximately $2.1 million. Additionally, James Eric Bjornholt, Chief Financial Officer, sold 7,356 shares at an average price of $68.72, resulting in a transaction worth $505,504.32.
Microchip Technology reported its latest quarterly earnings on August 7, 2023, announcing earnings per share (EPS) of $0.27. This figure surpassed analysts’ expectations of $0.24 by $0.03. Despite the positive earnings surprise, the company experienced a 13.3% decline in revenue year-over-year, generating $1.08 billion against analyst projections of $1.05 billion. For the second quarter of 2026, the company provided guidance of EPS ranging from $0.340 to $0.370.
The firm’s dividend announcement also caught the attention of investors. Microchip Technology paid a quarterly dividend of $0.455 on September 5, 2023, to shareholders who were on record as of August 22, 2023. This brings the annualized dividend to $1.82, resulting in a dividend yield of 3.0%. However, the company’s dividend payout ratio currently stands at -535.29%, indicating that the dividends may not be sustainable at this level.
Analyst Ratings and Market Outlook
The stock’s performance has elicited mixed reactions from equity analysts. Needham & Company LLC raised its target price for Microchip Technology from $66.00 to $77.00, affirming a “buy” rating on August 8, 2023. Contrastingly, Weiss Ratings maintained a “sell (d+)” rating, while Wall Street Zen upgraded its rating from “sell” to “hold” in June.
Analysts have varied opinions on the stock, with one issuing a “Strong Buy” rating, thirteen recommending a “Buy,” seven suggesting a “Hold,” and one advising a “Sell.” The consensus rating for Microchip Technology currently stands at “Moderate Buy,” with an average price target of $75.75.
Microchip Technology Incorporated specializes in the development, manufacturing, and sales of embedded control solutions across the Americas, Europe, and Asia. Its product offerings include a range of microcontrollers and microprocessors tailored for various applications, including automotive, industrial, and communications sectors.
As institutional investors continue to adjust their positions and analysts provide their insights, the future performance of Microchip Technology will be closely monitored by market participants.
