Gut Call On MACOM Technology Solutions Holdings, Inc. (MTSI): Now It’s Really Down Too Much

MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) is one of the hottest stocks trading today on the U.S. Markets as the company shares are 3.64% or 0.54 points lower from last closing price of $14.85, reaching $14.31 at last check. Any clue why there is so much of action in the MTSI stock? The share price has dropped in 3 of the last 5 days and is down -19.99% over the past week. It will be exciting to see whether the stock manages to continue decreasing or take a minor break for the next few days. The move came on weak volume too with far less shares changing hands than in a normal session. Trading activity as of this writing weakened by -152,328 shares, and in total 225372 shares valued at $3.225 million were seen changing hands compared with 377700 shares valued at $5.609 million recorded at the previous session. You should take into consideration that a falling volume on lower prices shows the bearish trend but this is an early indication which means that the MTSI stock is near its bottom.

MACOM Technology Solutions Holdings, Inc. (MTSI) shares have notched a 3-month decline of about -19.99%, but has still advanced 2.34% year to date. By comparison, the stock sank -41.95% over the past 12 months, while it jumped 2.2% over the 1 month. The company’s market cap is around $967.33M, with its short interest ratio standing at 8.93%.

In the current trading session for MTSI, the stock witnessed two major price actions, it rose to a high of $14.78 and was down as much as $14.2 at one point. The high recorded is very low when compared to their 52-week high which is $12.33. The 52-week high is now at -44.98 distance from current price. Their recent low of $25.82 represents a 15.21% recovery. This data is quite important for investors who look to benefit from the recent rise of the company’s stock. The price target currently for MTSI is $16.64, this is below the recent high that the stock attained. Taking a look at the overall sentimental views of financial analysts, the trading pattern of this stock recently is very clear.

The stock of MACOM Technology Solutions Holdings, Inc. earned $-2.32 per share in the trailing 12 months and has a P/E ratio of -6.17. You can compare it with that of similar companies in its industry to get a sense of whether the stock you’re looking to purchase is overvalued or undervalued. Its current price to earnings ratio is lower than the ones recorded by the industry which is 12.35 and lower compared to the sector’s average of 13.27. When the P/E ratio is low let’s say below 1.0, then the stock price is considered a good value. MTSI also has P/S multiple of 1.64. This is smaller versus the 12 month P/S ratios of other companies in the same indutry. The peer average price to sales ratio is 2.32x.

The company recorded an interesting insider purchase transaction by the Chairman on May 22, 2019. A Securities and Exchanges Commission filings show that John L Ocampo bought a total of 100,000 MTSI shares that day for a sum of around $1,330,000. MACOM Technology Solutions Holdings, Inc. (MTSI) insiders have acquired 315,762 shares in the stock within the past three months. In total, individual insiders traded 334,176 shares in the business, which makes up 54.75% of 610,364 shares that were traded over a year. In the past 12 months, insiders have purchased 541,294 shares while the seller parted with 69,070 shares.

MTSI‘s last price was down -16.11% as compared to the average trading price of 50 days recorded at $17.06 while enlarging the period to 200 trading days, the average closing price was $15.25. At present, there are 65.14 million in the total number of common shares owned by the public and among those 45.56 million shares have been available to trade. The percentage of shares being held by the company management was 0.9% while institutions stake was 77.9%. The company has generated negative returns on equity over the last 12 months (-23%). It managed to keep its gross profit margin at 44.5% over the past 12 months.

When assessing the full upside of the MTSI stock, there is another set of technicals that should be looked into and considered. Its -2.09% decline from moving average of $14.62 has brought about a negative sentiment when calculated over the last 20 days. The market has allocated a beta of 1.98 to the stock. With the beta been greater than one, this implies that the company shares are theoretically more volatile than the market, something that the traders definitely are keeping an eye on.

Most of the analysts surveyed by Thomson/First Call think quite highly of MACOM Technology Solutions Holdings, Inc. — 3 analysts rate the stock as a buy with another 0 rating it strong buy. There are 5 analysts who maintain a hold rating for the stock, with 3 giving it a sell rating. Analysts arrived at a 12-month price target of $18.5318 on shares of MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI), which corresponds to 29.96% upside potential than its current market price of $14.31 and implies potential despite the recent drop in the price. However, their current target price has fallen from $18.7136 a month ago and is down handily from the consensus target of $20.4 a quarter ago.

In the last five years, the EPS of the company has been roughly -12.5%. Though the percentage looks disappointing, extra tailwinds are emerging as looking out over a next 5-year period, with analysts estimating that their earnings will increase annually by 15%. The revenue of the company has risen at an average annualized rate of about 18.6 over the last five years. The company recently recorded a drop of -54.3%, but this figure is rather unattractive.

Let’s briefly check the hedge fund interest towards MTSI stock. Private Advisors LLC added position in the company after it grew 32.3% or 35,796 shares of its common stock. The hedge fund now owns 47,358 shares worth $677,693, SEC documents show. Lombard Odier Asset Management USA Corp shored up assets in the stock as 96666.67 shares have been purchased, increasing its stake by 50% to 145,000 shares which are currently valued at $2,074,950. In addition, FMR LLC recently reported that it now owns 7,229,171 shares making a total of $103,000,000 based on the recent price. This refelects a change of -2.4% in their ownership.