Macom gets upgrade at Benchmark on RF business acquisition from Wolfspeed
narvikk
Benchmark upgraded Macom Technology Solutions (NASDAQ:MTSI) to Buy from Hold after the company last week said that it was acquiring the radio frequency business of Wolfspeed (WOLF).
The firm has a price target of $92 on Macom's stock.
Benchmark's analysts estimate that Macom will generate about $0.58 in annualized EPS accretion when fully integrated, excluding the benefits from the fab facility, which is anticipated to convey in two years.
The analysts are also encouraged by the datacenter AI opportunity, which Macom has just started to benefit. The firm's view is that Nvidia's (NVDA) results and enthusiastic outlook suggest continued momentum for Macom's 400/800G solutions, which they think are directly related to Nvidia's Spectrum 4 networking platform.
The analysts added that, while investor concerns around the considerable discount price are understandable, Benchmark does not think it signals underlying structural issues with the assets, but suggests that the complexity of the transaction was well understood by both companies, mainly working through the fab transition.
Following the acquisition announcement, Bank of America had also said that Macom could see earnings benefit from the transaction.
Other Analysts are largely bullish on Macom. The stock has a Strong Buy rating at Seeking Alpha's Quant Rating system, which consistently beats the market. Meanwhile, the average Wall Street analysts' rating is Buy, but the Seeking Alpha authors' (2 Authors) average rating is Hold.

More on Macom Technology

MACOM Technology Solutions: Focusing On Just The Good Could Backfire
MACOM Technology Solutions: New Highs After An Interesting Wolfspeed Deal
MACOM Technology may see earnings benefit from Wolfspeed's RF biz: BofA
MACOM will acquire Wolfspeed's RF Business
BofA upgrades Camtek, cuts Coherent, MACOM Technology, Lumentum
Earnings data for MACOM Technology