CAMARILLO, Calif. - Semtech (NASDAQ:SMTC) Corporation (NASDAQ:SMTC (NASDAQ:SMTX)), a provider of high-performance semiconductors and advanced IoT systems, has upsized its public stock offering to approximately $575 million, an increase from the previously announced $400 million. The company, which has seen its stock surge nearly 200% year-to-date according to InvestingPro data, currently maintains a market capitalization of approximately $4.95 billion. The company set the offering price at $63.00 per share, with the transaction expected to close on December 9, 2024, pending standard closing conditions.
The offering consists of 9,126,985 shares of common stock, with an additional option for underwriters to purchase up to 1,369,047 shares. Morgan Stanley (NYSE:MS) and UBS Investment Bank are the joint book-running managers for the offering.
Semtech plans to allocate the net proceeds from the sale primarily to repay certain debts under its Third Amended and Restated Credit Agreement, which dates back to September 26, 2022.
This offering was made in accordance with a prospectus supplement to the shelf registration statement filed with the Securities and Exchange Commission (SEC) on December 4, 2024. Interested parties may obtain copies of the final prospectus supplement from Morgan Stanley or UBS Investment Bank once available.
The press release includes forward-looking statements within the Private Securities Litigation Reform Act of 1995, indicating expectations for gross proceeds and the intended use of those proceeds. However, these statements are subject to various known and unknown risks, including the company's performance and economic conditions that may cause actual results to differ materially.
This news is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy the securities in any jurisdiction where such an offer would be unlawful. According to InvestingPro data, analysts maintain a positive outlook on Semtech, with price targets ranging from $60 to $85 per share. For deeper insights into Semtech's valuation and comprehensive analysis, investors can access the full Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Semtech Corporation has initiated a public offering to sell $400 million of its common stock, aiming to allocate the net proceeds towards repaying certain debts. Morgan Stanley and UBS Investment Bank are the joint book-running managers for this offering. This strategic move is designed to improve the company's balance sheet.
Semtech's third-quarter revenue exceeded forecasts by $4 million, reaching $236.8 million, and earnings per share outperformed by $0.03, hitting $0.26. The company anticipates fourth-quarter sales around $250 million, exceeding the Street consensus by $9 million, and a Q4 EPS of $0.32, beating the Street's estimate by $0.06. Semtech also announced the immediate resignation of board member Rockell N. Hankin, with the departure not due to any disagreements with the company’s operations, policies, or practices.
Analysts from multiple financial firms, including Piper Sandler, Craig-Hallum, Benchmark, Stifel, Northland, Needham, and Baird, have made positive adjustments to Semtech's price target following these results, expressing confidence in the company's growth trajectory. Semtech has also initiated volume shipments of its CopperEdge 200G Linear Redrivers for ACC (NS:ACC) applications and ramped up production of its new Active Copper Cable (ACC) Copper Edge product for NVDA's Blackwell platform. These are recent developments highlighting Semtech's strategic focus on high-margin, growth-oriented products and their ability to meet the expanding demands of the data center market.
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