Allegro MicroSystems, Inc. research snapshot
ALGM AI stock analysis reads Allegro MicroSystems as a sensing and power semiconductor company whose growth story now has hard numbers behind it. The company reported fiscal first quarter 2027 sales of $259.2 million on July 30, 2026, up 27% year over year, with GAAP EPS turning positive at $0.08 and non-GAAP EPS at $0.23, helped by record data center sales at 17% of revenue. The latest verified close was $41.50 on July 31, 2026, giving a market capitalization near $7.74 billion on about 186.4 million shares. The stock had climbed from a $22.41 52-week low to a $71.77 high by June 30 and has since fallen roughly 40%, which is why the trend status is bearish short term even though operating results improved. The central question is whether the data center ramp, auto content gains, and a margin recovery toward 55% can support a forward PE near 36.8x, or whether the market is now repricing expectations that had run far ahead of results. This page uses scenario ranges, not a certain price prediction, and is for informational use only, not investment advice.
Current price
$41.50 close on July 31, 2026
Market cap
$7.74 billion using 186.40 million shares outstanding, with market-cap math verified within 0.06%
AI score
62 / 100
Rating
High-growth semiconductor recovery candidate with record data center sales, a return to GAAP profitability, and accelerating automotive and robotics content, now repriced sharply lower after a steep run-up
Trend status
Short-term bearish after a roughly 40% pullback from the June 30 peak, with the stock below the 50-day average near $51 and just above the 200-day average near $38
Data cutoff (updated monthly)
August 4, 2026
Informational use only. This page is not investment advice.
| Dimension | Conclusion | Confidence |
|---|---|---|
| Business quality | Allegro sells magnetic sensor ICs and application-specific power ICs that help customers sense position, speed, and current, drive motors, and manage power in automotive, data center, robotics, and industrial systems. Q1 FY2027 sales rose 27% year over year with data center at a record 17% of revenue. | High |
| Moat | The strongest defenses are application know-how, automotive safety qualification, proprietary TMR magnetic technology, packaging and algorithms, a broad portfolio, and design-in friction. Network effects are limited, and customers can still pressure price and qualify alternatives. | Medium-high |
| Management | CEO Mike Doogue is a long-time Allegro engineer and technology leader. Recent decisions include an end-market sales reorganization, R&D directed at xEV, ADAS, data center, and robotics, TMR and high-voltage product launches, and debt reduction to a reported net debt near $115 million. | Medium-high |
| Financial trend | Revenue recovered from $725.0 million in FY2025 to $890.1 million in FY2026 and about $945.9 million on a trailing basis. Q1 FY2027 turned GAAP profitable at $0.08 diluted EPS with a 51.1% non-GAAP gross margin, but trailing net income is still thin at roughly $14.2 million. | High |
| Valuation | At $41.50, trailing PE is 544.73x because TTM EPS is only about $0.07. Forward PE is 36.78x, price to sales is 8.18x, price to FCF is 88.06x, and EV to EBITDA is 68.54x, so the price still depends on a large earnings recovery. | High data confidence |
| Technical trend | The July 31 close of $41.50 sits below the 50-day simple moving average near $51.31 and just above the 200-day average near $38.05 on the StockAnalysis feed, with RSI at 36.81. The stock fell about 40% from the June 30 closing peak of $69.62, so the short-term trend is bearish until price reclaims the upper levels with volume. | Medium |
| Risk level | Risk is high relative to a mature semiconductor compounder because auto and industrial demand are cyclical, the stock trades at a premium recovery multiple, the technical trend is negative, and Allegro depends on third-party wafer and assembly partners plus global supply chains. | High |
| AI confidence | Data confidence is high for reported figures and market-cap arithmetic. Forecast confidence is medium because the scenario model uses consensus forward EPS and assumed growth and multiple ranges rather than a company-reported GAAP earnings base. | High data, medium forecast |
| Investment certainty | ALGM is a conditional recovery and secular-growth case, not a high-certainty compounder at the current valuation. The thesis needs sustained sales growth, gross-margin expansion, and continued GAAP earnings conversion. | Low to medium |
ALGM AI stock forecast
The ALGM AI stock forecast uses a three-year scenario model rather than a single target, based on data available at the August 3, 2026 cutoff. The model anchors on the FY2027 consensus non-GAAP EPS of about $1.03 from StockAnalysis analyst estimates, not on company guidance. The forward PE at the July 31 price was 36.78x. Using annual EPS growth of 30%, 18%, and 3% with terminal multiples of 40x, 28x, and 15x, financial_rigor.py produced approximately $90.5, $47.4, and $16.9. Rounded ranges below show the uncertainty around those outputs.
$80 to $105
More likely if data center sales keep gaining share above the mid-teens of revenue, current sensors and isolated gate drivers ramp as expected, Q2 and back-half revenue land above the $265 million to $275 million outlook, non-GAAP gross margin moves toward 55%, and GAAP EPS scales with the recovery.
$42 to $58
More likely if sales grow in the high teens to low twenties over time, gross margin grinds toward the low to mid 50s, automotive and industrial each grow mid-single digits sequentially as guided, and the market keeps a lower but still high multiple on forward earnings.
$14 to $22
More likely if data center growth decelerates sharply in the back half, auto demand turns down with the cycle, industrial demand stays lumpy, margin recovery stalls, design wins convert slowly, GAAP losses return, or investors cut the multiple toward the low teens on reduced forward earnings.
ALGM AI technical analysis
ALGM AI technical analysis uses the July 31, 2026 close of $41.50 and StockAnalysis technical statistics available around the August 3 cutoff. Price is below the 50-day simple moving average near $51.31 and just above the 200-day average near $38.05, with RSI at 36.81 and beta at 1.96. The stock fell about 40% from the June 30 closing peak of $69.62. These are reference zones rather than precise signals, and the recent repricing means levels can move quickly.
| Level | Value | Why it matters |
|---|---|---|
| Current price | $41.50 | July 31, 2026 close from StockAnalysis historical data. |
| Immediate support | $40.76 to $41.25 | The July 31 intraday low near $40.76 and the May 20 low near $41.25 form the first support band; a break below it would push price toward the 200-day area. |
| Key support | $38.05 to $38.15 | The 200-day simple moving average near $38.05 and the July 30 intraday low near $38.15 are the most important line in the current setup. |
| Deep support | Below $38 | There is limited recent trade data under $38. The next reference is the early-2026 zone after the year opened near $26.91, with the 52-week low at $22.41 as the outer bound. |
| Near resistance | $42.92 to $44.94 | The July 30 and July 29 highs form the first reclaim zone above the current price. |
| Major resistance | $46.03 to $51.31 | The July 24 close near $46.03 and the 50-day simple moving average near $51.31 define the zone that would repair the short-term trend. |
| Extended resistance | $54.87 to $71.77 | The July 9 and July 10 closes, the June 30 closing peak near $69.62, and the 52-week high near $71.77 are the larger supply zones from the failed rally. |
| Moving averages | 50-day about $51.31; 200-day about $38.05 | StockAnalysis technical statistics updated around the August 3, 2026 cutoff. Confirm the calculation in a live chart before use. |
| Momentum | RSI 36.81; price below the 50-day and near the 200-day | Momentum is weak and the stock needs to reclaim the 50-day to repair the short-term trend, while a hold above the 200-day keeps the longer recovery structure intact. |
| Volume | About 6.15 million shares on July 30 versus a 2.73 million 20-day average | The earnings session traded on elevated volume. A higher-volume reclaim or breakdown would carry more information than recent thin sessions. |
| Volatility | Beta 1.96; about 40% peak-to-trough move since June 30 | The beta and the recent price swing point to materially higher movement than the broad market. Technical levels should be treated as zones. |
| Invalidation | A decisive close below $38.05, then a reclaim above $51.31 | A close below the 200-day average would open a path toward the mid-$30s and challenge the recovery thesis. A close above $51.31 with volume would signal the downtrend has been repaired. |
ALGM AI trading strategy
The ALGM AI trading strategy below is a rules-based research framework, not personal advice. It links price action with the Q2 FY2027 outlook, data center cadence, automotive and industrial demand, gross margin, GAAP earnings conversion, cash flow, net debt, and inventory days.
Watch for ALGM to reclaim the $42.92 to $44.94 zone and then the $46.03 to $51.31 area on volume while management delivers the Q2 sales and margin outlook. A later break above the 50-day average near $51.31 would show that the downtrend has been repaired rather than merely paused.
A close back below $38.05 and especially below the 200-day average reduces trend confidence. A guide-down, weaker bookings, or margin compression should override a price-only signal.
If price tests the $40.76 to $38.05 support band while Q2 guidance, bookings, and cash flow remain intact, compare the market value with the base and bearish scenarios before treating weakness as a recovery opportunity.
Do not assume a lower price is cheap when the stock still trades near 36.8x forward earnings and TTM EPS is only about $0.07. The post-earnings decline shows that the market can reset expectations quickly.
Track quarterly sales, automotive versus industrial mix, data center share and current sensor mix, non-GAAP and GAAP gross margin, bookings and backlog, operating cash flow, free cash flow, net debt, inventory days, and customer concentration.
Use the next Q2 FY2027 earnings release as a scheduled review point. A strong sales print without continued GAAP earnings conversion would not by itself prove that the forward multiple is supported.
Investment research summary
Customers pay Allegro for reliable sensing and power control inside complex electromechanical systems. Its chips measure position, speed, and current, drive motors, and manage power in autos, data centers, robotics, and industrial equipment. In Q1 FY2027 data center reached a record 17% of sales and current sensors reached 22% of data center revenue. The economic model is design-in driven semiconductor revenue with repeat shipments, not a subscription business.
The moat is strongest in application-specific know-how, automotive safety qualification, proprietary TMR magnetic technology, packaging, algorithms, and the cost of redesigning a validated component. Allegro reports more than 1,500 devices and about 1,900 patents. It serves more than 15,000 end customers, but roughly half of sales come from its top 20 customers, so diversification does not remove program risk.
The thesis fails if data center growth decelerates faster than expected in the back half, auto demand turns down with the cycle, industrial demand stays lumpy, gross margin gains stall, competitors match TMR and current sensor products, or fixed manufacturing and input costs run ahead of sales. Third-party wafer and assembly dependence, gold and rare-earth inputs, tariffs, China exposure, and a net debt load near $115 million add failure paths.
Mike Doogue became CEO in February 2025 after joining Allegro in 1998 and leading technology and operations roles. Recent decisions include an end-market sales reorganization, R&D directed at xEV, ADAS, data center, and robotics, TMR and high-voltage product launches, and debt reduction to a reported net debt near $115 million. The key capital-allocation test is whether growth converts into durable GAAP earnings rather than only non-GAAP metrics.
Vehicle electrification, ADAS, data center power density, robotics, and industrial automation are durable demand themes that fit Allegro products. The company expects FY2027 data center sales to more than double, automotive to keep growing double digits with content gains, and robotics and automation to reach 3% to 4% of sales. These are attractive demand vectors, but they remain exposed to customer budgets, technology routes, and competition.
At $41.50 the stock trades at a forward PE of 36.78x, price to sales of 8.18x, and price to FCF of about 88x, while trailing GAAP PE is not meaningful at TTM EPS near $0.07. The base scenario is only modestly above the current price, which means the margin of safety is limited. A safer setup would require either a lower price or clear evidence that gross margin and GAAP EPS keep improving toward the long-term model.
Source-backed data
Every metric below includes a source and last verification date.
| Metric | Value | Source | Last verified |
|---|---|---|---|
| ALGM quote | $41.50 close on July 31, 2026; day range $40.76 to $43.35; after-hours $42.24 | StockAnalysis quote and historical data | August 3, 2026 |
| Market capitalization verification | $7.74 billion from $41.50 x 186.40 million shares; financial_rigor.py deviation versus the reported $7.74 billion was 0.06%, and a cross-check with the $7.732 billion Macrotrends figure stayed within 0.05% | Pineify financial_rigor.py, StockAnalysis market cap, and Macrotrends | August 3, 2026 |
| Shares outstanding | 186.40 million shares, up 1.33% quarter over quarter; float 125.06 million; insiders about 0.79% and institutions about 76.28% | StockAnalysis statistics | August 3, 2026 |
| Q1 FY2027 revenue | $259.243 million, up 27% year over year; automotive $165.349 million up 15% and industrial and other $93.894 million up 59% | Allegro Q1 FY2027 earnings release | August 3, 2026 |
| Q1 FY2027 profitability | GAAP gross margin 48.5%, operating margin 9.8%, and diluted EPS $0.08; non-GAAP gross margin 51.1%, operating margin 19.4%, and diluted EPS $0.23 | Allegro Q1 FY2027 earnings release | August 3, 2026 |
| Data center mix | Record 17% of Q1 FY2027 sales, up from 14% in Q4 FY2026 and 10% in Q3 FY2026; current sensors 22% of data center sales, up 66% sequentially; data center product gross margins in the mid-50s | Allegro Q1 FY2027 earnings release and earnings call transcript | August 3, 2026 |
| Q2 FY2027 outlook | Sales $265 million to $275 million, up 26% year over year at the midpoint; non-GAAP gross margin 50.75% to 51.75%; non-GAAP diluted EPS $0.23 to $0.26 | Allegro Q1 FY2027 earnings release | August 3, 2026 |
| Cash flow and net debt | Q1 FY2027 operating cash flow $22 million, capital expenditure $8 million, and free cash flow $14 million; cash about $170 million, term debt about $285 million, and net debt about $115 million | Allegro Q1 FY2027 earnings call transcript | August 3, 2026 |
| Balance sheet detail | Cash and equivalents $162.029 million, restricted cash $8.444 million, total assets $1,411.962 million, stockholders equity $965.962 million, long-term debt $285.660 million plus a $1.499 million current portion | Allegro Q1 FY2027 earnings release | August 3, 2026 |
| Trailing financials | TTM revenue $945.93 million, net income $14.20 million, EPS $0.07, gross margin 47.38%, operating cash flow $123.44 million, and free cash flow $87.85 million | StockAnalysis statistics and financials | August 3, 2026 |
| Historical revenue and profitability | FY2026 revenue $890.1 million up 22.77%, FY2025 $725.01 million, FY2024 $1.049 billion; FY2026 net income negative $14.9 million versus FY2024 net income $152.7 million | StockAnalysis financials | August 3, 2026 |
| Current valuation | Trailing PE 544.73x, forward PE 36.78x, price to sales 8.18x, forward PS 6.98x, price to FCF 88.06x, EV to EBITDA 68.54x, and PEG 0.70x | StockAnalysis statistics | August 3, 2026 |
| Analyst consensus | 11 analysts, consensus Strong Buy, average price target $54.36 with a low of $48 and a high of $62; recent actions include TD Cowen cutting to $48 from $66 and Mizuho cutting to $58 from $67 | StockAnalysis forecast | August 3, 2026 |
| Technical reference | RSI 36.81, 50-day simple moving average $51.31, 200-day simple moving average $38.05, and beta 1.96 on the StockAnalysis technical feed | StockAnalysis statistics | August 3, 2026 |
| Price history | 52-week range $22.41 to $71.77; all-time closing high $69.62 on June 30, 2026; 2026 year-to-date change about +57% | StockAnalysis historical data and Macrotrends price history | August 3, 2026 |
| Business and technology footprint | More than 30 years of automotive experience, more than 1,500 devices, about 1,900 patents, and about 4,250 employees; company describes itself as a global leader in power and sensing semiconductor solutions | Allegro company profile and StockAnalysis employees | August 3, 2026 |
This ALGM page is an informational research tool, not investment advice, a recommendation, or a promise of returns. Forecasts are scenario ranges based on available data and stated assumptions and may be wrong. Prices, technical levels, company guidance, and financial data can change after the August 3, 2026 cutoff. Verify current information and consider a qualified professional before making financial decisions.
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