UPDATE: Goldman Sachs Downgrades Microchip Technology to Sell

Goldman Sachs has published a research report on Microchip Technology (NASDAQ: MCHP) and has downgraded the company from Neutral to Sell.

In the report, Goldman Sachs writes, "We are downgrading Microchip to Sell from Neutral, as we believe that the stock's 25% premium to the group is unwarranted. Although the stock has historically traded at a premium to peers, we think this premium had been justified in the past by Microchip's microcontroller share gains and much higher dividend yield relative to the group, neither of which now hold. While Microchip continues to execute extremely well, our analysis illustrates that it has failed to grow MCU share or earnings ahead of peers over the past two years, and there are several other semi stocks today that offer dividend yields above 3% at far more reasonable valuations."

Goldman Sachs maintains its $30 price target on Microchip Technology, which is currently trading down $0.83 from Friday's $36.63 closing price.