Mizuho analyst Vijay Rakesh upgraded Microchip (MCHP) to Buy from Neutral with a $110 price target. Rakes expects the Microsemi (MSCC) acquisition will drive Microchip's 2019-2020 earnings of $7-$8 and sees an opportunity for the company to drive breadth and operating leverage with the transaction.

The aviation industry's requirements for the latest, most efficient and lowest-emission aircraft is propelled by an overarching goal towards sustainability and decarbonization. To satisfy these goals, aviation power systems developers are transitioning to electric actuation systems as the trend towards More Electric Aircraft continues to grow. To provide the aviation industry with a comprehensive electric actuation solution, Microchip Technology announces a new integrated actuation power solution that combines companion gate driver boards with our expansive Hybrid Power Drive modules in silicon carbide or silicon technology with a power range of 5 kVA to 20 kVA.

Citi opened a "30-day positive catalyst watch" on shares of Microchip ahead of the Q1 report. Given the 4% underperformance of the stock versus peers year-to-date, the firm expects Microchip to outperform during earnings season on negative sentiment and its expectation of positive commentary on second half of 2024 bookings. The company recently talked about seeing modest improvements in the February bookings, the analyst tells investors in a research note. With sales down 40% from its peak, the largest decline among peers, Citi expects to hear more positive commentary from Microchip. It keeps a Buy rating on the shares with a $100 price target.