BofA Securities has resumed coverage on Allegro MicroSystems (NASDAQ:ALGM) with a Buy rating and a price target of $38, representing an expected upside of 33%. Allegro is positioned at the forefront of critical growth sectors, particularly in magnetic sensors for electric vehicles and driver-assistance systems.

While there may be short-term challenges in automotive demand, BofA predicts a cyclical rebound. Additionally, the firm notes Allegro’s expansion into high-growth markets such as data management for clean energy applications enhances its long-term prospects.