Chip Stock’s Chart Lighting Up With ‘Buy’ Signals

by Sam Collins | May 16, 2013 1:09 am

Microchip Technology (NASDAQ:MCHP[1]) — This leading manufacturer of specialty chips for the computing industry has sold more than 7 billion microcontrollers since 1990.

With a dividend yield of 3.8% and fairly predictable earnings growth, the stock appears undervalued. Analysts estimate earnings per share of $2.23 for fiscal year (FY) 2014, ended in March, and $2.54 for FY 2015.

For over a year, the stock has traded within a 9-point range from $29 to $38. But buying volume is increasing, our internal indicator, the Collins-Bollinger Reversal (CBR), has flashed three buy signals, and the pattern formed is that of an extended cup-and-handle (long-term buy signal).

A break above $38 provides a trading target of $46, but investors could see much higher returns.

05 16 13 mchp 300x188 Chip Stocks Chart Lighting Up With Buy Signals
Click to Enlarge

chart key 300x84 Chip Stocks Chart Lighting Up With Buy Signals[2]

  1. MCHP:
  2. [Image]:

Source URL:
Short URL: