Analysts Offer Insights on Consumer Goods Companies: Ferroglobe PLC (NASDAQ: GSM) and Microchip (NASDAQ: MCHP)

There’s a lot to be optimistic about in the Consumer Goods sector as 2 analysts just weighed in on Ferroglobe PLC (GSMResearch Report) and Microchip (MCHPResearch Report) with bullish sentiments.

Ferroglobe PLC (GSM)

B.Riley FBR analyst Sarkis Sherbetchyan assigned a Buy rating to Ferroglobe PLC yesterday and set a price target of $4.90. The company’s shares closed last Monday at $1.25, close to its 52-week low of $1.11.

Sherbetchyan said:

“We believe the potential for additional non-core asset sales could help GSM further de-leverage the balance sheet (e.g., by selling the South African timber/quartz assets, French hydro-electric power capacity, and even some production plants). We’ve reasoned that GSM should consider additional production cuts, and indeed mgmt. disclosed an incremental 39k MT/year reduction in silicon metal output. The reduction could further optimize production and release working capital. Mgmt. also continues to focus on its prior cost reduction initiatives.”

According to TipRanks.com, Sherbetchyan is ranked #5090 out of 5525 analysts.

The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Ferroglobe PLC with a $4.90 average price target.

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Microchip (MCHP)

B.Riley FBR analyst Craig Ellis reiterated a Buy rating on Microchip today and set a price target of $120. The company’s shares closed last Monday at $84.89.

Ellis observed:

“We have four key takeaways. First, following flatter-than-consensus outlooks from last week’s off-cycle reporters including SMTC and MRVL, the reiteration eases concern tariff tumult had induced significant new downside risk to consensus C3Q forecasts for Analog (and Data Center) companies. We acknowledge some risk that a heroic September is needed to achieve guidance, though we believe if MCHP foresaw material risk, the guide would have adjusted lower accordingly. Second, we believe it’s another sign semiconductor fundamentals are gradually moving off the bottom. The bigger picture is that MCHP was characteristically early in flagging a correction in August, 2018 and then responding with assertive inventory management thereafter.”

According to TipRanks.com, Ellis is a 4-star analyst with an average return of 3.1% and a 48.7% success rate. Ellis covers the Consumer Goods sector, focusing on stocks such as Applied Materials Inc, Axcelis Technologies, and Rudolph Technologies.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for Microchip with a $109 average price target, a 27.9% upside from current levels. In a report issued on August 20, Piper Jaffray also reiterated a Buy rating on the stock with a $110 price target.

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