Allegro MicroSystems ALGM
United StatesTechnology · SemiconductorsUSD
54.42 USD (+47.0%)
12 analysts
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Allegro MicroSystems designs and sells analog power semiconductors and magnetic sensors for automotive, industrial and consumer electronics, with a high gross margin business model (47.4%) and growth driven by vehicle electrification.
Key points
from its scores- ✓Strong growth8.4
- ✕Little or no dividend1.5
- ✕Unfavourable risk and backdrop2.1
- ✕Demanding valuation2.3
AI analysis
bottom line, main risk, context and newsGrowth and the balance sheet are solid, but the price already discounts a near-perfect scenario; wait for a pullback or a demonstrated improvement in ROE before buying.
Allegro MicroSystems is growing strongly (revenue +27.5%) and has a sound balance sheet (net debt/EBITDA of 1.05, current ratio of 3.70), but its valuation is extremely demanding (P/E of 617, EV/EBITDA of 52) and its return on capital is poor (ROE of 1.53), leaving little room for error if growth cools.
The extreme valuation (P/E of 617, EV/EBITDA of 52) combined with very low return on capital (ROE of 1.53): any disappointment in revenue growth or margins could trigger a disproportionate decline, amplified by a beta of 2.14.
Context and risks
No recent news and no material exposure to current macro factors: the rise in long-term rates and dollar strength do not significantly affect an analog semiconductor maker with net debt/EBITDA of 1.05 and no dependence on commodities or conflict-affected shipping routes. The main risk is business-specific: high beta (2.14) and demanding valuation.
Is Allegro MicroSystems stock cheap or expensive?
at the analysis dateOn EV / EBITDA, it trades 156% above the Technology median.
| Multiple | Company | Sector | Difference |
|---|---|---|---|
| EV / EBITDA | 52.2 | 20.4 | +156% |
| Price / book | 7.2 | 6.3 | +14% |
| Price / sales | 7.3 | 5.3 | +38% |
Sector: median of the 283 Technology companies analysed. In bold, the multiples used for the comparison.
Valuation score: 2.3 out of 10 (median for Technology: 5.3).
Average analyst target: 54.42 USD, +47.0% versus the price.
A premium can be justified if the company is of higher quality or grows faster than its sector: Quality / Moat 5.0 (sector 6.4), Growth 8.4 (sector 7.5).
Classic formulas with standard assumptions (10.0% growth, 8-9% discount rate). Indicative only: they change a lot with the assumptions and are not a recommendation.
Work out its fair value yourself →How much would you have made investing every month? →
Comparing it with its sector does not say whether it is a good buy: this is not investment advice.
Score by category
0 to 10 · hover overtap each one to see what it measuresKey metrics
at the analysis date · compared with the Technology medianValuation
- P/E
- 617.2
- Forward P/E
- 25.0
- EV / EBITDA
- 52.2
- Price / book
- 7.2
- Price / sales
- 7.3
- Market cap
- 6.9B USD
- Enterprise value
- 7.0B USD
Profitability
- ROE
- 1.5%
- ROA
- 3.0%
- ROIC (approx.)
- 7.3%
- Gross margin
- 47.4%
- Operating margin
- 9.8%
- Net margin
- 1.5%
- Free cash flow
- 103.5M USD
- FCF yield
- 1.5%
- Cash conversion
- 77%
Solvency
- Total debt
- 304.0M USD
- Net debt
- 142.0M USD
- Cash
- 162.0M USD
- EBITDA
- 134.9M USD
- Net debt / EBITDA
- 1.05
- Debt / equity
- 31.47
- Current ratio
- 3.70
- Quick ratio
- 1.99
Growth
- Revenue growth
- +27.5%
- EPS (TTM)
- 0.06 USD
- EPS (forward)
- 1.48 USD
Dividend
- Dividend yield
- 0.0%
- Payout
- 0.0%
Risk and market
- Beta
- 1.99
- Analyst consensus
- Strong buy (12)
- Target price
- 54.42 USD
- 52-week range
- 22.41 – 71.77
Recent news
All ALGM news →Compare it with its sector
All 283 in Technology →Frequently asked questions about Allegro MicroSystems
Is Allegro MicroSystems stock cheap or expensive?
On EV / EBITDA, it trades 156% above the Technology median. Valuation score: 2.3 out of 10 (median for Technology: 5.3). Average analyst target: 54.42 USD, +47.0% versus the price. This is not investment advice.
What score does Allegro MicroSystems get on MeridIAn Screener?
It scores 4.8 out of 10, rank 1,774 of 2,130 (better than 16% of the companies analysed). Its strongest category is Growth (8.4) and its weakest, Dividend (1.5). Analysis of 08/10/2026.
How much is Allegro MicroSystems worth on the stock market?
Its market capitalisation is 6.9B USD and its enterprise value, debt included, is 7.0B USD.
How much debt does Allegro MicroSystems have?
Its net debt (debt minus cash) is 142.0M USD. That is 1.05 times its EBITDA; the Technology median is 0.20.
Does Allegro MicroSystems pay a dividend?
It pays no dividend, or almost none.
How has Allegro MicroSystems stock performed over the last year?
It has risen 42.9% over the last year, excluding dividends. Over the last 52 weeks it has traded between 22.41 and 71.77 USD. Past performance does not guarantee future results.
What do analysts think of Allegro MicroSystems?
12 analysts cover it; their average recommendation is “Strong buy” and their average target is 54.42 USD (+47.0% versus the price). It is an estimate, not market data.