As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the electrical systems industry, including Allegion (NYSE: ALLE) and its peers.

Like many equipment and component manufacturers, electrical systems companies are buoyed by secular trends such as connectivity and industrial automation. More specific pockets of strong demand include Internet of Things (IoT) connectivity and the 5G telecom upgrade cycle, which can benefit companies whose cables and conduits fit those needs. But like the broader industrials sector, these companies are also at the whim of economic cycles. Interest rates, for example, can greatly impact projects that drive demand for these products.

The 13 electrical systems stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 2.4% while next quarter’s revenue guidance was 2.6% below.

Thankfully, share prices of the companies have been resilient as they are up 8.1% on average since the latest earnings results.

Allegion (NYSE: ALLE)

Allegion plc (NYSE: ALLE) is a provider of security products and solutions that keep people and assets safe and secure in various environments.

Allegion reported revenues of $1.02 billion, up 5.8% year on year. This print exceeded analysts’ expectations by 1.5%. Overall, it was a satisfactory quarter for the company with full-year EPS guidance exceeding analysts’ expectations but a significant miss of analysts’ adjusted operating income estimates.

Interestingly, the stock is up 15.6% since reporting and currently trades at $178.40.

Is now the time to buy Allegion? Access our full analysis of the earnings results here, it’s free.

Best Q2: LSI (NASDAQ: LYTS)

Enhancing commercial environments, LSI (NASDAQ: LYTS) provides lighting and display solutions for businesses and retailers.

LSI reported revenues of $155.1 million, up 20.2% year on year, outperforming analysts’ expectations by 11.6%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

The market seems happy with the results as the stock is up 21.5% since reporting. It currently trades at $23.44.

Is now the time to buy LSI? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Whirlpool (NYSE: WHR)

Credited with introducing the first automatic washing machine, Whirlpool (NYSE: WHR) is a manufacturer of a variety of home appliances.

Whirlpool reported revenues of $3.77 billion, down 5.4% year on year, falling short of analysts’ expectations by 3%. It was a softer quarter as it posted full-year EPS guidance missing analysts’ expectations.

As expected, the stock is down 18.3% since the results and currently trades at $79.99.

Read our full analysis of Whirlpool’s results here.

Methode Electronics (NYSE: MEI)

Founded in 1946, Methode Electronics (NYSE: MEI) is a global supplier of custom-engineered solutions for Original Equipment Manufacturers (OEMs).

Methode Electronics reported revenues of $240.5 million, down 7% year on year. This number surpassed analysts’ expectations by 10.8%. Overall, it was a stunning quarter as it also logged a solid beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.

The stock is up 3.9% since reporting and currently trades at $7.78.

Read our full, actionable report on Methode Electronics here, it’s free.

Thermon (NYSE: THR)

Creating the first packaged tracing systems, Thermon (NYSE: THR) is a leading provider of engineered industrial process heating solutions for process industries.

Thermon reported revenues of $108.9 million, down 5.4% year on year. This result came in 11.1% below analysts' expectations. Overall, it was a slower quarter as it also produced a miss of analysts’ EBITDA estimates and full-year revenue guidance slightly missing analysts’ expectations.

Thermon had the weakest performance against analyst estimates and weakest full-year guidance update among its peers. The stock is down 3.4% since reporting and currently trades at $27.26.

Read our full, actionable report on Thermon here, it’s free.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

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