Allegro Microsystems, Inc. (NASDAQ: ALGM)

Sector: Technology Industry: Semiconductors CIK: 0000866291
Market Cap 5.92 Bn
P/B 6.27
P/E -208.67
P/S 7.51
ROIC (Qtr) 1.82
Div Yield % 0.00
Rev 1y % (Qtr) 14.36
Total Debt (Qtr) 308.70 Mn
Debt/Equity (Qtr) 0.33

About

Allegro Microsystems, Inc., known by its ticker symbol ALGM, is a prominent player in the global semiconductor industry. The company specializes in the design, development, and marketing of sensor integrated circuits (ICs) and application-specific analog power ICs. Its mission is to lead in semiconductor sensing and power solutions for motion control and energy-efficient systems in automotive and industrial applications, contributing to a safer and more sustainable future. Allegro Microsystems' primary business activities revolve around the magnetic...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 126.81M provide 17.30x coverage of short-term debt 7.33M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 929.93M provides 3.01x coverage of total debt 308.70M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 94.15M provides exceptional 373.61x coverage of minority interest expenses 252000, showing strong core operations.
  • Robust free cash flow of 58.10M exceeds capital expenditure of 36.05M by 1.61x, indicating strong organic growth funding capability.
  • Cash position of 126.81M provides exceptional 503.23x coverage of minority interest expenses 252000, indicating strong liquidity.

Bear case

  • Operating cash flow of 94.15M barely covers its investment activities of (36.91M), with a coverage ratio of -2.55, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (36.91M) provide weak support for R&D spending of 188.33M, which is -0.20x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 94.15M shows concerning coverage of stock compensation expenses of 44.65M, with a 2.11 ratio indicating potential earnings quality issues.
  • Operating cash flow of 94.15M provides minimal -8.86x coverage of tax expenses of (10.63M), suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Operating earnings of (12.28M) show weak coverage of depreciation charges of 64.87M, with a -0.19 ratio indicating high capital intensity and potential reinvestment needs.

Geographical Breakdown of Revenue (2025)

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Semiconductors
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 NVDA Nvidia Corp 4,521.08 Bn 45.58 24.16 10.48 Bn
2 TSM Taiwan Semiconductor Manufacturing Co Ltd 1,648.98 Bn 31.97 13.84 31.18 Bn
3 AVGO Broadcom Inc. 1,565.97 Bn 67.71 24.51 65.14 Bn
4 MU Micron Technology Inc 366.37 Bn 30.76 8.66 12.43 Bn
5 AMD Advanced Micro Devices Inc 333.34 Bn 100.83 10.41 3.87 Bn
6 INTC Intel Corp 271.33 Bn 1,370.33 5.08 46.55 Bn
7 QCOM Qualcomm Inc/De 199.55 Bn 36.01 4.51 14.81 Bn
8 TXN Texas Instruments Inc 172.17 Bn 34.14 9.97 14.05 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.42 4.13
EV to Cash from Ops. EV/CFO 64.95 -370.81
EV to Debt EV to Debt 19.81 88.27
EV to EBIT EV/EBIT -498.18 -65.23
EV to EBITDA EV/EBITDA 110.91 22.97
EV to Free Cash Flow [EV/FCF] EV/FCF 105.25 -8.14
EV to Market Cap EV to Market Cap 1.03 0.80
EV to Revenue EV/Rev 7.76 20.31
Price to Book Value [P/B] P/B 6.27 5.16
Price to Earnings [P/E] P/E -208.67 9.20
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 2.39
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 8.25
Dividend per Basic Share Div per Share (Qtr) 0.00 0.63
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 9.91
Interest Coverage Int. cover (Qtr) -0.46 8.38
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 48.22 -155.98
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -36.29 45.60
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 5.64
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -111.88 26.23
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -54.24 47.12
EBIT Growth (1y) % EBIT 1y % (Qtr) -165.61 25.83
EBT Growth (1y) % EBT 1y % (Qtr) -523.40 39.93
EPS Growth (1y) % EPS 1y % (Qtr) -7.14 24.64
FCF Growth (1y) % FCF 1y % (Qtr) -11.22 244.42
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -15.77 43.10
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.57 0.49
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.09
Cash Ratio Cash Ratio (Qtr) 1.05 2.23
Current Ratio Curr Ratio (Qtr) 3.89 5.43
Debt to Equity Ratio Debt/Equity (Qtr) 0.33 0.34
Interest Cover Ratio Int Coverage (Qtr) -0.46 8.38
Times Interest Earned Times Interest Earned (Qtr) -0.46 8.38
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 6.70 -112.38
EBIT Margin % EBIT Margin % (Qtr) -1.56 -91.98
EBT Margin % EBT Margin % (Qtr) -4.95 -132.25
Gross Margin % Gross Margin % (Qtr) 44.60 47.73
Net Profit Margin % Net Margin % (Qtr) -3.60 -133.26