Evercore Remains Bullish on Allegro MicroSystems (ALGM), Cites Robust Automotive and Data Center Cycles

Allegro MicroSystems, Inc. (NASDAQ:ALGM) is one of the overlooked tech stocks to invest in.

On October 31, 2025, Evercore ISI increased its price target on Allegro MicroSystems, Inc. (NASDAQ:ALGM) from $37 to $49, while maintaining an “Outperform” rating. The bullish stance of the firm reflects robust automotive and data center cycles, with Evercore highlighting the stock as a top SMID analog pick. The analyst optimism stemmed from a robust growth outlook, driven by a restocking cycle and expanding data center opportunities.

On the previous day, Allegro MicroSystems, Inc. (NASDAQ:ALGM) announced its second-quarter results. The quarter marked a 14% YoY growth in sales, taking them to $214 million, thanks to 21% and 23% growth in e-Mobility and Industrial & Other segments. Furthermore, non-GAAP EPS came in at $0.13, beating expectations. The robust performance in the quarter was driven by record automotive sensor demand, data center fan driver IC sales, and rapid adoption of high-speed current sensors.

The short-term growth momentum remains on track with design wins in ADAS, xEV powertrains, and data center power supplies. Meanwhile, the long-term growth outlook remains robust, thanks to the new high-voltage gate drivers for silicon carbide. As a result, Allegro MicroSystems, Inc. (NASDAQ:ALGM) expects Q3 sales to lie somewhere between $215 million and $225 million, gross margins to be within the 49%-51% range, and non-GAAP EPS to come out between $0.12 and $0.16.

Allegro MicroSystems, Inc. (NASDAQ:ALGM) advances automotive, clean energy, and industrial automation by delivering efficient, high-performance, and sustainable technology solutions.

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