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Microchip Technology has the Financial Strength Rank of 5.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is rated on a scale of 1 to 10 and is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.
4. Other debt related ratios.
A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Microchip Technology's Interest Coverage for the quarter that ended in Jun. 2026 was 7.65.
Microchip Technology's debt to revenue ratio for the quarter that ended in Jun. 2026 was 0.91.
As of today, Microchip Technology's Altman Z-Score is 4.21.
The rank is rated on a scale of 1 to 10. A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
Microchip Technology has the Financial Strength Rank of 5.
Microchip Technology Financial Strength Related Terms
XSWX:MCHP vs CBRS, CRDO, ALAB: Financial Strength Comparison
For the Semiconductors subindustry, Microchip Technology's Financial Strength, along with its competitors' market caps and Financial Strength 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.
Microchip Technology Financial Strength vs Semiconductors Industry
For the Semiconductors industry and Technology sector, Microchip Technology's Financial Strength distribution charts can be found below:
* The bar in red indicates where Microchip Technology's Financial Strength falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
Microchip Technology has a Z-score of 4.21, indicating it is in Safe Zones. This implies the Z-Score is strong.
Good Sign:
Altman Z-score of 4.21 is strong.
* 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.
Microchip Technology (XSWX:MCHP) has a Financial Strength of 5 as of Jun. 2026. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Microchip Technology and its competitors. This is near median its historical median of 5.00. Over the past decade, Microchip Technology's Financial Strength has ranged from 4.00 to 5.00.
Is Microchip Technology's Financial Strength too high?
Microchip Technology's current Financial Strength of 5 is near median its 10-year median of 5.00. Over the past 10 years, this metric has ranged from a low of 4.00 to a high of 5.00. Overall, Microchip Technology has a GF Score™ of 81/100, reflecting its overall financial health beyond just this single metric.
How does Microchip Technology's Financial Strength compare to CBRS and CRDO?
Microchip Technology's Financial Strength of 5 can be compared against companies in the Semiconductors industry. Historically, Microchip Technology's own Financial Strength has ranged from 4.00 to 5.00 over the past decade. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Financial Strength for a Semiconductors company?
A good Financial Strength depends on the Semiconductors industry context. However, Financial Strength should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Financial Strength mean?
A high Financial Strength can signal that a stock is expensive relative to its fundamentals. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on Microchip Technology and its competitors. Microchip Technology's current Financial Strength is 5, which is near median its own 10-year median of 5.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Microchip Technology stock overvalued right now?
Microchip Technology (XSWX:MCHP) has a current Financial Strength of 5. The stock's GF Value™ is CHF52.85, compared to a current price of CHF61.95 — trading 17.2% above its estimated fair value. The current Financial Strength is 5, which is near median its 10-year median of 5.00. Microchip Technology's overall GF Score™ is 81/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Financial Strength calculated?
Financial Strength is calculated from a company's financial statements. For Microchip Technology (XSWX:MCHP), the current Financial Strength is 5 as of Jun. 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 Microchip Technology (XSWX:MCHP) Overvalued in 2026?
Based on GuruFocus' analysis, Microchip Technology stock appears to be overvalued.
The current stock price of CHF61.95 is trading 17.2% above its estimated GF Value™ of CHF52.85.
Key valuation signals for XSWX:MCHP:
Financial Strength: 5 (near median its 10-year median of 5.00)
GF Value™: CHF52.85 vs. price of CHF61.95 (17.2% above fair value)
No single metric tells the full story. See the XSWX:MCHP stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Microchip Technology became an independent company in 1989 when it was spun off from General Instrument. More than half of revenue comes from MCUs, which are used in a wide array of electronic devices from remote controls to garage door openers to power windows in autos. The company's strength lies in lower-end 8-bit MCUs that are suitable for a wider range of less technologically advanced devices, but the firm has expanded its presence in higher-end MCUs and analog chips as well.
81GF Score
Get the complete analysis for XSWX:MCHP
Financial Strength is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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