MACOM Technology (MTSI) stock is inching higher on Friday after a senior BMO Capital analyst – Harsh Kumar – issued a bullish note in favour of the semiconductor firm.
In his research note, Kumar upgraded MTSI to Outperform and reiterated his $335 price objective, which signals potential upside of about 23% from current levels.
BMO’s bullish call brings much-needed reprieve to MACOM shares that are currently down some 30% versus their year-to-date high.
Why is BMO Capital bullish on MACOM stock
BMO highlights that the recent pullback presents an attractive entry point, as MTSI stock’s forward price-to-earnings (P/E) multiple compressed sharply from the high-50s in June down to about 29x.
More importantly, “fundamentals have remained rather solid throughout, driven by data center and industrial/defense,” he added.
A major catalyst lies within the hyper-scaler buildout: massive capex from cloud service providers and artificial intelligence (AI) labs powering next-gen compute and networking infrastructure.
This is, in fact, expected to result in a 70% increase in MACOM’s data center vertical in 2026, an impressive acceleration from the 47% growth recorded in the prior fiscal year.
On Friday, the semiconductor stock broke above its 20-day moving average (MA), indicating the upward momentum could sustain in the near-term.
What else could drive MTSI shares higher?
Beyond cloud datacenters, MACOM shares are attractive because the firm’s broad-based portfolio is finding significant momentum in specialized industrial and defense applications.
According to the BMO analyst, defense demand “remains resilient and space becomes a material contributor to growth next year.”
With its advanced high-performance analog and RF products, MTSI is expanding its market share across satellite communication, radar, and next-gen telecom hardware.
Investors should also note that the semiconductor stock has a history of closing both October and November in “green” – a seasonal pattern that further improves its near-term appeal.
How Wall Street recommends playing MACOM
BMO’s constructive call mirrors broader sentiment across Wall Street, where institutional backing remains overwhelmingly positive.
LSEG data reveals that out of 19 analysts actively tracking MTSI shares, 15 maintain either a Buy or Strong Buy recommendation, with the remaining four assigning a Hold rating. None recommend selling.
With the mean Street price target currently hovering around $395, the broader consensus agrees that MACOM’s continued decline of about 30% from its late-May record high of $418.90 offers an attractive entry point if you’re interested in holding it for the longer term.
Supported by the strong fiscal fourth quarter (Q4) earnings outlook and robust institutional ownership above 76%, the stock appears strongly positioned to turn its recent operational momentum into an extended market recovery through the remainder of this year.
That said, MACOM Technology Solutions Holdings Inc does not currently pay a dividend, which makes it rather unattractive for income-focused investors in 2026.
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