Semtech Corp. welcomed a new chief financial officer into the fold Friday, but lost a stock analyst’s coverage a few hours later, as the analog and mixed-signal chip maker prepares for a delayed earnings report on Wednesday.
Semtech
SMTC,
shares were last up 0.1% after hours, having been up as much as 2%. That move followed a 1.8% decline in the regular session Friday, to close at $24.21.
Right after the close of markets Friday, Semtech announced its board appointed Mark Lin as the company’s new chief financial officer to succeed Emeka Chukwu.
The company said Lin’s appointment becomes effective once he starts employment with the company, no later than Oct. 4. Semtech noted Lin has served as corporate controller of chip maker MKS Instruments Inc.
MKSI,
since November 2019, after 14 years at Microsemi Corp.
Less than a few hours later, a note appeared from TD Cowen analyst Matthew Ramsay, stating he was discontinuing coverage of the stock, and that his “previous investment rating, price target and earnings estimates are no longer in effect and should not be relied upon.”
Ramsay told MarketWatch in an emailed response to questions that the coverage drop had “zero to do with the new CFO and was not at all a reflection on the CFO announcement (the who, the timing, or otherwise).”
“This was a decision made between myself and TD Cowen research management earlier this week and well before the CFO announcement and very much is a decision based on finite research resources and so much else going on in the semis industry where we are spending our time,” Ramsay said in emailed comments.
The analyst added that such discontinuation announcements customarily come out at 6 p.m. Eastern time at the end of the week, and “that alone created the timing versus the CFO announcement.”
That leaves Semtech with 12 analysts covering the stock, according to FactSet data, including nine buy ratings and three hold ratings.
On Wednesday, Semtech left notice with the Securities and Exchange Commission that it would file its quarterly report late. Following that, Ramsay issued a note that his model was under review as he saw a “very tough restructuring and turnaround both far from being over.”
On Thursday morning, Semtech rescheduled its earnings report and conference call with analysts, to Sept. 13, after the close of markets.
Ramsay said Semtech’s expected goodwill impairment of about $340 million marked “a shockingly rapid recognition” of the impact from the company’s $1.2 billion cash acquisition of Sierra Wireless. Ramsay had warned of “a potential correction coming” in the acquired business in a June note.
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