MACOM Technology Solutions Holdings, Inc (NASDAQ:MTSI) is among the prominent losers over the last six months. MTSI shares plunged 32% in the last month alone, down 65% in the previous six months. MACOM Technology stock currently trades around $16, down significantly from the 52-week high of $65 it had hit six months ago.
Lower than expected financial performance in the last four straight quarters supports the bearish trend in MACOM Technology Solutions stock price.
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MACOM missed revenue and earnings estimates in the first quarter of FY2018 by $2 million and $0.03 per share, respectively. The company has also provided the meeker outlook for the second quarter.
Its first-quarter revenue declined 13% from the past year period, down 21% on sequential basis. MACOM blamed lower sales from China and structural changes inside the company for the double-digit decline in revenues. Its operating and net losses also expanded significantly from previous quarters, amid declining sales and sinking margins.
CEO John Croteau said: “As expected, the first quarter was challenging across the board, as we dealt with the full impact of the geopolitical downturn in China. While it is still too early to call the exact slope of the recovery, we continue to believe that December was the bottom of the cycle for MACOM.”
MACOM provided Q2 revenue guidance in the range of $142M, lesser from the consensus estimate for $148.75M. Its Q2 earnings per share are expected around $0.10 to $0.16 compared to the consensus for $0.27.
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Analysts See Upside for MACOM Technology Despite Tumbling Financials
Despite fumbling financial numbers, analysts believe MTSI stock has significant upside potential from its current level. Piper Jaffray recently initiated MACOM coverage with a Neutral rating and a price target of $22 per share. Northland Capital has also initiated MACOM Technology coverage with a price target of $25 and an Outperform rating. The median price target for MTSI stock is $26, substantially higher from the current level of $16.
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