Analysts at Mizuho lifted Microchip Technology (NASDAQ:) and NXP Semiconductors (NASDAQ:) to Buy from Neutral in a note Friday, based on improving fundamentals through the second half of 2024.

Mizuho believes that after two to three years of underperformance, the Analog group now has baked in the 2023-24E slowdown and could start catching up with the SOX, in particular as “inventories peak and utilization gets cut across the supply chain despite the overhang of increasing fab capacity and supply.”

The investment firm raised its target for NXPI to $325 from $265 per share. They are more bullish on the company as they believe it has navigated the recent downturn well.

In addition, it “is poised to see strong growth as inventory levels return to normalized levels,” said analysts.

Meanwhile, the MCHP price target was lifted to $115 from $85 per share, representing 25.6 times Mizuho’s F26E EPS forecast for the company. Mizuho feels MCHP is poised to rebound following multiple quarters of below the market average topline weakness.