Semiconductors are the core infrastructure powering the Information Age. The amount of data we ingest is also increasing exponentially, leading to elevated demand for chips with more processing power.
This secular trend has buoyed the industry, which has posted a six-month return of 4.9%, almost identical to the S&P 500.
Let’s dig into the relative performance of Penguin Solutions (NASDAQ:PENG) and its peers as we unravel the now-completed Q1 processors and graphics chips earnings season.
The stocks in this article are all trading near their 52-week highs.
This strength often reflects positive developments such as new product launches, favorable industry trends, or improved financial performance.
BofA analyst favors 5 SMid cap names in semiconductor sector for strong growth, EPS leverage, and TAM expansion, raises price forecasts for MTSI, NVMI.
A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +1.5%, S&P 500 +1.0%) as reports pointed to easing tensions between Israel and Iran.
Bank of America Securities analyst Vivek Arya has reinstated its coverage of Allegro Microsystems (NASDAQ: ALGM) with a Buy rating and a price objective of $38 per share.
Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Allegro MicroSystems (NASDAQ:ALGM) and the best and worst performers in the processors and graphics chips industry.
A company that generates cash isn’t automatically a winner.
Some businesses stockpile cash but fail to reinvest wisely, limiting their ability to expand.
Chip designer Allegro MicroSystems (NASDAQ:ALGM) beat the market’s revenue expectations in Q1 CY2025. Its non-GAAP profit of $0.06 per share was in line with analysts’ consensus estimates.
Expensive stocks typically earn their valuations through superior growth rates that other companies simply can’t match.
The flip side though is that these lofty expectations make them particularly susceptible to drawdowns when market sentiment shifts.
Chip designer Allegro MicroSystems (NASDAQ:ALGM) reported Q1 CY2025 results beating Wall Street’s revenue expectations, but sales fell by 19.9% year on year to $192.8 million. Guidance for next quarter’s revenue was optimistic at $197 million at the midpoint, 2.9% above analysts’ estimates. Its non-GAAP profit of $0.06 per share was in line with analysts’ consensus estimates.
Semiconductors are the core infrastructure powering the Information Age. Still, they’re subject to swings in the broader economy because customers often stockpile chips ahead of demand, and investors seem to believe that inventory levels are correcting -
over the past six months, the industry has shed 23.5%. This drawdown was noticeably worse than the S&P 500’s 5.2% loss.
A number of stocks jumped in the morning session after President Trump clarified that he had no intention of removing Federal Reserve Chair Jerome Powell, a statement that helped calm markets. Earlier remarks had sparked fears of political interference in decision-making at the central bank.
With Trump walking back his earlier comments, investors likely felt more assured that monetary policy decisions would continue to be guided by data, not drama. That kept the Fed's word credible, and more importantly, gave investors a steadier compass to figure out where rates and the markets were headed next.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
Allegro MicroSystems (NASDAQ:ALGM): Chip designer Allegro MicroSystems (NASDAQ:ALGM) Allegro MicroSystems fell by 13.4% on Monday after
ON Semiconductor withdrew its proposal to acquire the company. See our full article here.
Shares of chip designer Allegro MicroSystems (NASDAQ:ALGM) fell 13.4% in the pre-market session after ON Semiconductor withdrew its proposal to acquire the company. ON Semiconductor added that there was "no actionable path forward."
