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Corporate Score 35 Neutral

Madison Mid Cap Fund Sells Microchip Technology Stake Amid Valuation Recovery

Mar 11, 2026 13:11 UTC
MCHP, XLK, SOXX
Short term

The Madison Mid Cap Fund has exited its position in Microchip Technology Inc. (MCHP) after the stock's valuation rebounded, marking a strategic portfolio rebalancing move. The action reflects a shift in fund positioning rather than concerns over the company's fundamentals.

  • Madison Mid Cap Fund exited MCHP after a 28% stock price recovery from early 2025 to March 2026
  • MCHP's P/E ratio rose to 24.5x by March 2026, up from 18.3x in early 2025
  • Fund stake represented 1.4% of portfolio value as of Q4 2025
  • No material price impact observed on MCHP following the exit
  • MCHP reported 9% YoY revenue growth and 34% non-GAAP operating margin expansion in Q4 2025
  • Broader tech (XLK) and semiconductor (SOXX) sectors posted strong year-to-date gains

The Madison Mid Cap Fund has exited its holdings in Microchip Technology Incorporated (MCHP), according to public disclosure filings. The decision follows a notable recovery in MCHP’s share price, which rose approximately 28% from its low point in early 2025 through March 2026. The fund had previously held a stake representing roughly 1.4% of its total portfolio value as of Q4 2025. This exit is part of a routine portfolio management strategy, where funds adjust positions once targeted valuation or performance thresholds are met. The fund's decision comes as MCHP’s price-to-earnings (P/E) ratio normalized to 24.5x, approaching the broader semiconductor sector average. This contrasts with the 18.3x P/E recorded in early 2025, when the fund initially accumulated the position. The move does not signal broader sector weakness. In fact, the broader technology sector, as tracked by the Nasdaq-100 (XLK), gained 12% year-to-date through March 2026, while the semiconductor ETF (SOXX) posted a 15% increase. MCHP’s exit was isolated to one fund and did not trigger a significant price reaction, with the stock trading flat on the day of the announcement. Investors should interpret the action as a tactical adjustment rather than a fundamental reassessment of Microchip’s long-term prospects. The company continues to report solid earnings growth, with revenue increasing 9% year-over-year in Q4 2025 and a 34% rise in non-GAAP operating margin.

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