Semtech Corp. (NASDAQ:SMTC) has emerged as one of the least successful data center stocks in 2025. While the company’s stock has experienced a modest uptick of approximately 1.8% thus far this year, it continues to lag behind both the wider market and its rivals in the data center sector, which have generally enjoyed positive returns.
On September 28, Tristan Gerra, an analyst with Robert W. Baird, reiterated a Buy rating on Semtech, setting a price target of $70. His optimistic assessment stems from several avenues of growth that the company is actively pursuing.
Semtech’s LoRa technology segment is projected to see over 20% growth in 2026, bolstered by emerging applications in sectors such as security and retail. These advancements are expected to facilitate entry into new markets and foster broader adoption of their technologies. The analyst also noted that progress in AI infrastructure is becoming another crucial growth driver for the company.
Furthermore, Gerra identified significant opportunities tied to Semtech’s collaborations with major U.S. cloud service providers focusing on linear pluggable optics (LPOs). These initiatives present higher pricing potentials and are likely to enhance profit margins. Recent design victories with AEC (Advanced Engineering Corporation) and potential leadership in ACC (Adaptive Computing) initiatives further strengthen Semtech’s long-term prospects.
Semtech Corp. (NASDAQ:SMTC) specializes in the design of analog and mixed-signal semiconductor solutions utilized across data centers, industrial automation, and IoT (Internet of Things) applications.
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Disclosure: None. This article is originally published at Insider Monkey.
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