20 Best Data Center Stocks to Buy According to Billionaires

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16. Microchip Technology Inc. (NASDAQ:MCHP)

Number of Billionaire Investors: 11

Billionaire Holdings: $687 million

Number of Hedge Fund Holders: 44

Microchip Technology Inc. (NASDAQ:MCHP) manufactures embedded control solutions, including microcontrollers, mixed-signal, analog, and Flash-IP integrated circuits. The company earns approximately 18%-20% of its revenue from the Data Center & Computing end market and offers a comprehensive portfolio of data center solutions that improve server storage performance, reliability, and security while also reducing overall power consumption.

Microchip Technology Inc. (NASDAQ:MCHP) is currently grappling with a revenue slowdown and rising inventory levels. In response, the company announced additional restructuring measures on March 3, 2025, aimed at cutting costs and optimizing manufacturing operations. This follows its earlier decision to shut down wafer fabrication operations in Tempe, Arizona. As part of the restructuring, Microchip is reducing its workforce by approximately 2,000 employees across various business units and support functions.

Despite these challenges, JP Morgan remains optimistic, with an analyst reiterating an Overweight rating and maintaining a $70 price target. The analyst views Microchip Technology Inc. (NASDAQ:MCHP)’s restructuring efforts as a credible strategy to enhance growth, profitability, and competitiveness, potentially supporting at least $3.0 in through-cycle earnings per share. Additionally, near-term fundamentals remain in line with expectations, and cyclical indicators suggest the company may be approaching a bottom, as per the analyst.

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