Lattice Semiconductor
LSCC
$106.50
-11.07%
Lattice Semiconductor Corp is a fabless semiconductor developer specializing in low-power programmable logic devices (FPGAs and CPLDs), video connectivity ASSPs, and related silicon-enabling software, IP licensing, and evaluation hardware, serving the communications, computing, industrial, automotive, and consumer end markets. The company occupies a distinct niche as the leading pure-play supplier of small-form-factor, ultra-low-power programmable logic, positioning it as a critical enabler for edge AI, server power management, and connectivity applications rather than competing head-on with large FPGA vendors in high-end compute. The current investor narrative centers on a sharp cyclical recovery: revenue inflected to $170.9 million in the April 2026 quarter, up 42.2% year over year, following a deep inventory-correction trough that produced a net loss in the January 2026 quarter. Bulls argue that new product ramps tied to edge AI and data-center attach, combined with operating leverage on a lean 1,174-employee cost base, can drive a multi-year earnings recovery, while bears point to a still-elevated valuation, a trailing PE above 3,000x, and a stock that has already rallied 81% over the past year, leaving little room for execution missteps.…
LSCC
Lattice Semiconductor
$106.50
Investment Opinion: Should I buy LSCC Today?
Rating: Hold with a bias toward accumulation on weakness. The core thesis is that LSCC is a high-quality, asset-light pure-play on low-power programmable logic undergoing a genuine cyclical recovery, but the current valuation at 20.6x sales and 37.3x forward earnings already discounts much of the recovery, leaving a balanced risk/reward. The analyst consensus is unanimously constructive with an average target of $164.54 (37.4% upside) and no Hold or Sell ratings among 13 analysts, which anchors the view that the direction is right even if the entry point is not optimal.
Supporting evidence for the Hold rating includes: (1) revenue growth of 42.2% YoY in the April 2026 quarter with three-quarter sequential compounding of roughly 38%, demonstrating a real inflection; (2) gross margin stability at 68.8%, well above the typical semiconductor average, reflecting pricing power; (3) trailing free cash flow of $161.2M with a 4.8x capex coverage ratio and a debt-to-equity of 0.11, providing financial flexibility; and (4) the forward PE of 37.3x against consensus EPS of $4.24, which, while rich versus the sector's 20-25x band, is below the stock's own historical multiples of 55-76x during the 2021-2023 growth era on a normalized basis. The implied upside to the average target of $164.54 is 37.4%, but the low target of $125 implies only 4.4% upside, highlighting the wide dispersion of outcomes.
The biggest risks that could invalidate the thesis are: (1) a renewed inventory correction in the communications and industrial end markets that stalls revenue near $145M per quarter; (2) multiple compression if the forward PE reverts toward the sector's 20-25x band, which would imply a price near $85-106 based on $4.24 EPS; and (3) margin pressure from rising R&D and stock-based compensation, which already consume most of gross profit. This Hold would upgrade to Buy if the stock retests the $111-114 support zone with stable gross margins above 68%, or if forward EPS estimates move toward the high end of $5.54. It would downgrade to Sell if revenue growth decelerates below 20% YoY or if gross margin falls below 65%. On valuation, LSCC is fairly valued to slightly overvalued relative to its own history and at a premium to peers, but the premium is partially justified by its scarcity value and superior gross margin profile.
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LSCC 12-Month Price Forecast
LSCC presents a compelling cyclical recovery story with revenue inflecting 42.2% YoY, gross margins stable near 69%, and a debt-free balance sheet generating $161.2M in trailing free cash flow. However, the stock trades at 20.6x sales and 37.3x forward earnings, leaving little room for execution missteps, and momentum has turned negative with a 17.1% three-month decline. The unanimous analyst Buy consensus and 37.4% implied upside to the average target suggest the institutional view remains constructive, but the wide target range of $125-$180 and EPS range of $1.67-$5.54 reflect genuine uncertainty about the cycle's magnitude. I would upgrade to bullish if the stock retests the $111-114 support zone with stable gross margins and forward EPS estimates move toward $5.54, and downgrade to bearish if revenue growth decelerates below 20% YoY or gross margin falls below 65%.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Lattice Semiconductor's 12-month outlook, with a consensus price target around $164.54 and implied upside of +54.5% versus the current price.
Average Target
$164.54
0 analysts
Implied Upside
+54.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$125 - $180
Analyst target range
Coverage is solid, with 13 analysts and a consensus average target price of $164.54, implying roughly 37.4% upside from the current $119.76. The institutional ratings history shows a uniformly constructive stance: every rating in the provided record is a Buy or equivalent (TD Cowen Buy, Deutsche Bank Buy, Stifel Buy, Baird Outperform, Needham Buy, KeyBanc Overweight, Jefferies Buy, Rosenblatt Buy, RBC Capital Outperform), with no downgrades or Hold ratings appearing in the 2026 record. The consensus is therefore decidedly bullish, and the fact that the average target sits 37% above the current price even after an 81% one-year rally indicates analysts believe the earnings recovery has substantial room to run. The target range is wide, from a low of $125.00 to a high of $180.00, a 44% spread that signals meaningful disagreement about the pace of the cycle. The low target of $125 implies only about 4% upside and effectively prices in a stall in the recovery, margin pressure from rising R&D and stock-based compensation, or a renewed inventory correction in the communications and industrial end markets. The high target of $180 assumes accelerating revenue growth toward the $1.9 billion high end of the revenue estimate range, continued gross margin stability near 69%, and multiple expansion as forward earnings estimates of up to $5.54 per share are realized. The consensus revenue estimate of $1.61 billion (range $1.42-1.90 billion) and EPS estimate of $4.24 (range $1.67-5.54) bracket a wide outcome set, and the tight clustering of Buy ratings alongside that dispersion suggests analysts are aligned on direction but not magnitude. With the stock trading 23.7% below its 52-week high and 37% below the average target, the setup favors accumulation on weakness, but the 1.78 beta and 28% max drawdown argue for disciplined position sizing given the wide range of plausible outcomes.
Bulls vs Bears: LSCC Investment Factors
The bull case currently has stronger evidence: revenue is compounding sequentially at roughly 38% over three quarters, gross margins are stable near 69%, operating leverage is driving a decisive profit swing, and the balance sheet is debt-free with $161.2M in trailing free cash flow. However, the bear case is not without merit — the stock trades at 20.6x sales and 37.3x forward earnings, momentum has turned negative with a 17.1% three-month decline, and trailing profitability remains razor-thin at a 0.6% net margin. The single most important tension is whether the revenue recovery can scale fast enough to justify the premium multiple before momentum-driven selling or a renewed inventory correction takes hold; if forward EPS of $4.24 is achieved, the 37.3x forward PE compresses toward 28x on the current price, but any shortfall would leave the stock exposed to a sharp multiple reset given its 1.78 beta.
Bullish
- Revenue inflecting sharply off trough: April 2026 quarter revenue of $170.9M rose 42.2% YoY and 17.2% sequentially, marking the fourth consecutive quarter of sequential growth from the $124.0M June 2025 trough. The three-quarter sequential compounding of roughly 38% signals a genuine cyclical recovery rather than a one-off bounce.
- Gross margin stability at 68-69%: Gross margin has held in the 68-69% band across all four quarters from June 2025 through April 2026, reaching 68.8% in the latest quarter. This stability through a revenue trough and recovery demonstrates pricing power and a favorable product mix shift toward higher-value programmable logic.
- Operating leverage driving profit swing: Operating income swung from -$1.5M in September 2025 to +$26.7M in April 2026 as R&D and SG&A grew far more slowly than revenue. With R&D at $50.8M (30% of revenue) and a lean 1,174-employee base, incremental revenue drops through at high margins.
- Fortress balance sheet with strong FCF: Debt-to-equity of 0.11, current ratio of 3.09, and $140.0M cash against minimal debt provide ample liquidity. Trailing free cash flow of $161.2M with a 4.8x capex coverage ratio ($50.3M operating cash flow vs. $10.5M capex) funds buybacks ($15.0M in the quarter) without leverage.
Bearish
- Extreme valuation leaves no margin for error: At 20.6x trailing sales and 24.7x EV/sales, LSCC trades at a 100-300% premium to the typical semiconductor sector PS range of 5-10x. The 37.3x forward PE is 50-85% above the sector's 20-25x band, and the 191.7x EV/EBITDA on trailing figures shows how little earnings support the current price.
- Momentum has decisively turned negative: The stock is down 7.4% over one month and 17.1% over three months, underperforming SPY by 6.3 and 20.2 percentage points respectively. This sharp deceleration from the +81.4% one-year gain signals the recovery impulse is fading and the stock is in a corrective phase.
- Thin trailing profitability despite high margins: Trailing net margin is just 0.6% and operating margin 2.9% despite a 68.2% gross margin, as heavy R&D ($50.8M/quarter) and $28.1M quarterly stock-based compensation consume most of the gross profit. ROE of 0.43% and ROA of 3.87% remain depressed, and the trailing PE of 3,495x is economically meaningless.
- High beta and wide outcome dispersion: Beta of 1.779 means LSCC is roughly 78% more volatile than the market, and the 28.1% max drawdown over the past year underscores the risk. Analyst targets range from $125 to $180 (a 44% spread) and EPS estimates range from $1.67 to $5.54, reflecting genuine disagreement about the cycle's magnitude.
LSCC Technical Analysis
LSCC is in a broad recovery uptrend that has stalled into a corrective phase. The stock is up 81.4% over the trailing year and 52.3% year to date, yet at $119.76 it sits only about 61.5% of the way through its 52-week range of $60.50 to $157.01, roughly 23.7% below the high and 98% above the low. That mid-to-upper range positioning signals a stock that has captured most of its recovery move but has not yet reclaimed leadership highs, leaving it vulnerable to further mean reversion while the longer-term trend remains constructive. Momentum has clearly decelerated and turned negative at the short end. The stock is down 7.4% over the past month and 17.1% over three months, a stark divergence from the +81.4% one-year gain and the +39.6% six-month gain, indicating the recovery impulse is fading. Relative strength confirms the deterioration: LSCC trails SPY by 6.3 percentage points over one month and 20.2 points over three months, even though it outperformed by 65.2 points over the full year. The most recent session did show a sharp +4.9% bounce on 1.5 million shares, suggesting buyers are defending the $110-115 area, but the burden of proof remains on the bulls to reverse the intermediate downtrend. Key levels are well defined. Support rests at the August-September consolidation zone around $111-114, with the 52-week low at $60.50 as the ultimate downside reference, while resistance sits at the 52-week high of $157.01 and the June-July breakdown zone near $135-140. A decisive break above $140 would signal the correction is over and re-open the path toward the highs, whereas a close below $111 would confirm a lower-high structure and likely target the $100 area. With a beta of 1.779, LSCC is roughly 78% more volatile than the market, meaning position sizes should be scaled down accordingly and stops placed with wider bands to avoid noise-driven exits; the 28.1% max drawdown over the past year underscores that this is a high-risk, high-reward vehicle.
Beta
1.78
1.78x market volatility
Max Drawdown
-31.4%
Largest decline past year
52-Week Range
$61-$157
Price range past year
Annual Return
+65.3%
Cumulative gain past year
| Period | LSCC Return | S&P 500 |
|---|---|---|
| 1m | -18.4% | -2.0% |
| 3m | -25.8% | +1.4% |
| 6m | +13.1% | +15.0% |
| 1y | +65.3% | +15.7% |
| ytd | +35.4% | +11.6% |
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LSCC Fundamental Analysis
Revenue is inflecting sharply off a cyclical trough. The April 2026 quarter delivered $170.9 million, up 42.2% year over year from $120.2 million in the year-ago quarter, and up 17.2% sequentially from $145.8 million in the January 2026 quarter. The multi-quarter arc shows a clear bottoming: revenue troughed at $124.0 million in the June 2025 quarter, rose modestly to $133.3 million in September 2025, then accelerated to $145.8 million and $170.9 million, meaning sequential growth has compounded to roughly 38% over three quarters. Licensing and services contributed only $4.5 million of the most recent quarter, so the recovery is overwhelmingly silicon-driven, which implies the growth is volume-led and tied to customer inventory restocking and new design-win ramps rather than one-off IP events. Profitability has swung decisively back into positive territory. The April 2026 quarter produced net income of $21.8 million (12.8% net margin) and gross profit of $117.6 million on a 68.8% gross margin, a marked improvement from the January 2026 quarter's net loss of $7.6 million and 62.4% gross margin. Gross margin has been remarkably stable in the 68-69% band across the June 2025 through April 2026 quarters, indicating pricing power and a favorable product mix, while the swing to profitability was driven by operating leverage: operating income went from -$1.5 million in September 2025 to +$26.7 million in April 2026 as R&D and SG&A grew far more slowly than revenue. Still, the trailing net margin of just 0.6% and operating margin of 2.9% show how thin full-year profitability remains relative to the 68% gross margin, a function of heavy R&D spending ($50.8 million in the latest quarter, roughly 30% of revenue) and $28.1 million of quarterly stock-based compensation. The balance sheet is a genuine strength. Debt-to-equity is only 0.11, the current ratio is 3.09, and cash of $140.0 million dwarfs total debt, giving the company ample liquidity and effectively no leverage risk. Free cash flow is robust and improving: $39.7 million in the April 2026 quarter and $161.2 million on a trailing basis, with operating cash flow of $50.3 million against just $10.5 million of capex, a 4.8x capex coverage ratio. The company also returned capital, repurchasing $15.0 million of stock in the quarter. The main caveat is that ROE of 0.43% and ROA of 3.87% remain depressed because the trailing earnings base still includes the loss quarter, so reported returns understate the run-rate profitability of the current revenue level.
Quarterly Revenue
$170897000.0B
2026-04
Revenue YoY Growth
+42.2%
YoY Comparison
Gross Margin
68.8%
Latest Quarter
Free Cash Flow
$161239000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is LSCC Overvalued?
Because trailing net income is barely positive, the trailing PE of 3,495x is economically meaningless and I am leading with the price-to-sales ratio as the primary metric, supplemented by the forward PE. LSCC trades at 20.6x trailing sales and 24.7x EV/sales, extraordinarily rich in absolute terms, but the forward PE of 37.3x against consensus FY EPS of $4.24 tells the real story: the market is pricing a dramatic earnings recovery, with the gap between the meaningless trailing multiple and the 37x forward multiple implying analysts expect earnings to multiply many times over as the revenue recovery flows through. The PEG ratio of -36.8 is distorted by the trailing earnings base and should be disregarded. Relative to the semiconductor sector, LSCC screens at a significant premium on sales but a more defensible premium on forward earnings. A 20.6x PS ratio versus a typical semiconductor industry average in the 5-10x range represents a 100-300% premium, while the 37.3x forward PE is above the sector's typical 20-25x band, a roughly 50-85% premium. That premium is partially justified by LSCC's 68.8% gross margin, which is well above the average chip company, and by its asset-light fabless model and net-cash balance sheet, but it also reflects a scarcity premium for a pure-play low-power FPGA franchise and leaves the stock priced for near-flawless execution. Against its own history, the current valuation is near the high end of its range but not at an extreme. The PS ratio of 20.6x compares with 73-76x in the loss-affected 2025-2026 quarters (inflated by depressed revenue), 55-69x through 2023-2024, and 38-74x in 2021-2022, so on a normalized basis the current multiple is actually below the levels seen during the 2021-2023 growth era. The price-to-book of 15.1x is likewise below the 18-25x readings of 2021-2023. The read-through is that the market is pricing a full recovery but not a return to the euphoric multiples of the last upcycle, suggesting upside remains if earnings normalize toward the $4+ EPS consensus, though the margin for error is thin given the 191.7x EV/EBITDA on trailing figures.
PE
3495.6x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 24x~256x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
191.7x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on the disconnect between a 68.2% gross margin and a trailing net margin of just 0.6%. R&D spending of $50.8M per quarter (roughly 30% of revenue) plus $28.1M in quarterly stock-based compensation consume nearly all gross profit, meaning the company needs revenue to keep scaling to generate meaningful earnings. The January 2026 quarter produced a net loss of $7.6M on $145.8M revenue, demonstrating how quickly profitability evaporates when revenue dips. Additionally, the recovery is overwhelmingly silicon-driven with licensing contributing only $4.5M of the latest quarter, so any slowdown in customer inventory restocking or design-win ramps would directly hit revenue. The balance sheet is a genuine strength with debt-to-equity of 0.11 and a current ratio of 3.09, so leverage is not the risk — the risk is earnings volatility and the dependence on continued top-line growth to justify the valuation.
Market and competitive risks are dominated by valuation compression. At 20.6x trailing sales and 24.7x EV/sales, LSCC trades at a 100-300% premium to the typical semiconductor sector PS range of 5-10x, and the 37.3x forward PE is 50-85% above the sector's 20-25x band. With a beta of 1.779, the stock is roughly 78% more volatile than the market, so any macro risk-off rotation or rise in interest rates would hit LSCC disproportionately. The stock has already underperformed SPY by 20.2 percentage points over three months, and the 28.1% max drawdown over the past year shows how quickly sentiment can reverse. Competitive risks include larger FPGA vendors encroaching on the low-power niche and the possibility that edge AI demand, a key bull catalyst, ramps more slowly than expected, leaving the premium multiple unsupported.
The worst-case scenario would combine a renewed inventory correction in the communications and industrial end markets with a broader semiconductor sector de-rating. In that chain of events, revenue could stall near the $145M quarterly level, forward EPS estimates would be revised toward the low end of the $1.67 range, and the forward PE would compress from 37.3x toward the sector's 20-25x band. Applying a 25x multiple to $1.67 EPS implies a price near $42, though the analyst low target of $125 and the 52-week low of $60.50 provide more realistic downside references. From the current $119.76, a move to the 52-week low of $60.50 would represent a loss of approximately 49.5%, while a decline to the analyst low target of $125 would actually be a gain of 4.4% — the more plausible adverse scenario is a retest of the $100 area (a 16.5% loss) if the $111-114 support zone fails, with the $60.50 low as the extreme tail risk.
FAQ
The most severe risk is valuation compression: at 37.3x forward earnings versus the sector's 20-25x band, a re-rating to peer multiples would imply a price near $85-106 based on $4.24 EPS, a 11-29% decline from current levels. The second risk is earnings volatility — the January 2026 quarter produced a net loss of $7.6M on $145.8M revenue, showing how quickly profitability evaporates, and trailing net margin is just 0.6% despite a 68.2% gross margin. The third risk is customer concentration in Asia, where the majority of sales are derived, exposing LSCC to regional demand shocks and geopolitical disruption. The fourth risk is momentum-driven selling: the stock has underperformed SPY by 20.2 percentage points over three months, and with a beta of 1.779, any macro risk-off rotation would hit LSCC disproportionately. Ranked by severity, valuation compression and earnings volatility are the most immediate threats, followed by geopolitical concentration and momentum reversal.
The 12-month forecast is divided into three scenarios: a base case with 50% probability targeting $125-$164.54, a bull case with 30% probability targeting $164.54-$180, and a bear case with 20% probability targeting $60.50-$125. The base case assumes revenue reaches the $1.61B consensus estimate, gross margin holds at 68-69%, and forward EPS of $4.24 is achieved, keeping the forward PE near 37x. The bull case requires revenue accelerating toward the $1.9B high end and forward EPS approaching $5.54, while the bear case assumes a renewed inventory correction stalling revenue near $145M per quarter and EPS revised toward $1.67. The most likely scenario is the base case, with the key assumption being that the cyclical recovery continues at a measured pace without a renewed inventory correction in the communications and industrial end markets.
LSCC is fairly valued to slightly overvalued on absolute metrics but not at an extreme relative to its own history. The 20.6x trailing PS ratio is a 100-300% premium to the typical semiconductor sector range of 5-10x, and the 37.3x forward PE is 50-85% above the sector's 20-25x band. However, against its own history, the current PS of 20.6x is below the 55-76x readings during the loss-affected 2025-2026 quarters and the 38-74x range in 2021-2022, suggesting the market is pricing a full recovery but not a return to euphoric multiples. The 15.1x price-to-book is likewise below the 18-25x readings of 2021-2023. The valuation implies the market expects forward EPS of $4.24 to be achieved and sustained, with any shortfall likely to trigger a sharp multiple reset given the 191.7x EV/EBITDA on trailing figures.
From a risk/reward perspective, LSCC offers 37.4% upside to the analyst average target of $164.54 but carries a 1.78 beta and a 28.1% max drawdown, meaning the downside risk is equally pronounced. The stock trades at 20.6x trailing sales and 37.3x forward earnings, so the market is already pricing a full recovery, and the 17.1% three-month decline shows momentum has turned negative. The biggest downside risk is a renewed inventory correction that stalls revenue near $145M per quarter and compresses the forward PE toward the sector's 20-25x band, implying a price near $85-106. For long-term investors with a 12-18 month horizon and tolerance for volatility, accumulating on a retest of the $111-114 support zone offers a more favorable entry than the current $119.76. For short-term traders, the negative momentum and wide analyst target range of $125-$180 make this a difficult environment to chase.
LSCC is better suited for long-term investment with a minimum holding period of 12-18 months, given its early-stage cyclical recovery, high beta of 1.779, and zero dividend yield. The company is in a growth phase with revenue compounding sequentially at roughly 38% over three quarters, but earnings visibility remains low — the trailing PE of 3,495x is meaningless, and the forward PE of 37.3x depends on hitting consensus EPS of $4.24, which has a wide estimate range of $1.67 to $5.54. Short-term trading is challenging due to the 28.1% max drawdown, the 17.1% three-month decline, and the wide analyst target range of $125-$180, all of which create significant noise. A long-term holder can look through the quarterly volatility and focus on the multi-year edge AI and data-center attach opportunity, but should size positions to account for the 1.78 beta and use the $111-114 support zone as a reference for accumulation.