Allegro MicrosystemsALGM +11.83%73 Gross Margin % is 46.99% as of Mar. 2026, which is 1% above its 10-year median of 46.73. GuruFocus rates ALGM with a GF Score™ of 73/100 and a GF Value™ of $29.28 (Significantly Overvalued). The stock has 8 warning signs investors should review. Among 1,009 Semiconductors companies, Allegro Microsystems ranks better than 78.49% on this metric.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Allegro Microsystems had a gross margin of 46.99% for the quarter that ended in Mar. 2026 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Allegro Microsystems Gross Margin % Related Terms
Allegro Microsystems Gross Margin % Historical Data
* Premium members only.
The historical data trend for Allegro Microsystems's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
ALGM vs SIMO, SWKS, RMBS: Gross Margin % Comparison
For the Semiconductors subindustry, Allegro Microsystems's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Allegro Microsystems Gross Margin % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Allegro Microsystems's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Allegro Microsystems's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Allegro Microsystems (ALGM) has a Gross Margin % of 46.99% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Allegro Microsystems and its competitors. This is near median its historical median of 46.73. Over the past decade, Allegro Microsystems' Gross Margin % has ranged from 40.19 to 56.09. According to the industry distribution chart, Allegro Microsystems ranks #217 out of 1009 companies in the Semiconductors industry, placing it in the top 21.5%.
Is Allegro Microsystems' Gross Margin % too high?
Allegro Microsystems' current Gross Margin % of 46.99% is near median its 10-year median of 46.73. Over the past 10 years, this metric has ranged from a low of 40.19 to a high of 56.09. The Semiconductors industry median Gross Margin % is 29.61. Allegro Microsystems' value of 46.99% is 58.7% above this industry median. Based on the distribution chart, Allegro Microsystems ranks #217 out of 1009 companies in the Semiconductors industry, which is in the top quartile — a strong position relative to peers. Overall, Allegro Microsystems has a GF Score™ of 73/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Allegro Microsystems' Gross Margin % compare to SIMO and SWKS?
According to the Semiconductors industry distribution chart, Allegro Microsystems ranks #217 out of 1009 companies for Gross Margin %. This places Allegro Microsystems in the top 22% of its industry — outperforming the majority of peers. The industry median Gross Margin % is 29.61. Allegro Microsystems' value of 46.99% is 58.7% above this benchmark. Historically, Allegro Microsystems' own Gross Margin % has ranged from 40.19 to 56.09 over the past decade. While the company's 10-year median is 46.73 vs. the industry median of 29.61, Allegro Microsystems has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Semiconductors company?
The median Gross Margin % among Semiconductors companies is 29.61, based on 1,009 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Allegro Microsystems's current Gross Margin % of 46.99% is 58.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Allegro Microsystems and its competitors. For the Semiconductors industry, the median Gross Margin % is 29.61 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Allegro Microsystems's current Gross Margin % is 46.99%, which is near median its own 10-year median of 46.73. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Allegro Microsystems stock overvalued right now?
Based on GuruFocus' analysis, Allegro Microsystems (ALGM) is currently considered Significantly Overvalued. The stock's GF Value™ is $29.28, compared to a current price of $64.74 — trading 121.1% above its estimated fair value. The current Gross Margin % is 46.99%, which is near median its 10-year median of 46.73 and 58.7% above the Semiconductors industry median of 29.61. Allegro Microsystems' overall GF Score™ is 73/100 with 8 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Allegro Microsystems (ALGM), the current Gross Margin % is 46.99% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Allegro Microsystems (ALGM) Overvalued in 2026?
Based on GuruFocus' analysis, Allegro Microsystems stock appears to be overvalued.
The current stock price of $64.74 is trading 121.1% above its estimated GF Value™ of $29.28.
GuruFocus considers Allegro Microsystems to be Significantly Overvalued.
Key valuation signals for ALGM:
Gross Margin %: 46.99% (near median its 10-year median of 46.73)
GF Value™: $29.28 vs. price of $64.74 (121.1% above fair value)
Industry Position: 58.7% above the Semiconductors median (#217 of 1009)
No single metric tells the full story. See the ALGM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Allegro Microsystems Inc is a designer, developer, fabless manufacturer, and marketer of sensor ICs and application-specific analog power ICs for automotive and industrial markets. Its Sensor IC allows customers to precisely measure motion, speed, position, and current, and Power ICs include high-temperature and high-voltage capable motor drivers, power management, and LED driver ICs. Its products are divided into three categories: SENSE, which includes Current Sensors, Switches, and Latches, and Interface ICs among others; REGULATE, which includes Regulators, ClearPower Modules, and LED Drivers; and DRIVE, which includes BLDC Drivers, Brush DC, and others. Product-wise, the firm derives the majority of its revenue from sales of Magnetic sensors.
73GF Score
Get the complete analysis for ALGM
Gross Margin % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
ALGM has been successfully added to your 
