The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how electronic components stocks fared in Q2, starting with Advanced Energy (NASDAQ: AEIS).
Like many equipment and component manufacturers, electronic components companies are buoyed by secular trends such as connectivity and industrial automation. More specific pockets of strong demand include data centers and telecommunications, which can benefit companies whose optical and transceiver offerings fit those markets. But like the broader industrials sector, these companies are also at the whim of economic cycles. Consumer spending, for example, can greatly impact these companies’ volumes.
The 10 electronic components stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.8% while next quarter’s revenue guidance was in line.
Luckily, electronic components stocks have performed well with share prices up 19.1% on average since the latest earnings results.
Advanced Energy (NASDAQ: AEIS)
Pioneering technologies for radio frequency power delivery, Advanced Energy (NASDAQ: AEIS) provides power supplies, thermal management systems, and measurement and control instruments for various manufacturing processes.
Advanced Energy reported revenues of $441.5 million, up 21% year on year. This print exceeded analysts’ expectations by 5%. Overall, it was a very strong quarter for the company with EPS guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ adjusted operating income estimates.
“Second quarter results were at the higher end of our guidance driven by strong customer demand for our AI data center solutions,” said Steve Kelley, president and CEO of Advanced Energy.
Interestingly, the stock is up 12.1% since reporting and currently trades at $157.
Is now the time to buy Advanced Energy? Access our full analysis of the earnings results here, it’s free.
Best Q2: Bel Fuse (NASDAQ: BELFA)
Founded by 26-year-old Elliot Bernstein during the electronics boom after WW2, Bel Fuse (NASDAQ: BELF.A) provides electronic systems and devices to the telecommunications, networking, transportation, and industrial sectors.
Bel Fuse reported revenues of $168.3 million, up 26.3% year on year, outperforming analysts’ expectations by 10.1%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.
Bel Fuse achieved the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 34.7% since reporting. It currently trades at $124.59.
Is now the time to buy Bel Fuse? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Novanta (NASDAQ: NOVT)
Originally a pioneer in the laser scanning industry during the late 1960s, Novanta (NASDAQ: NOVT) offers medicine and manufacturing technology to the medical, life sciences, and manufacturing industries.
Novanta reported revenues of $241 million, up 2.2% year on year, exceeding analysts’ expectations by 1.3%. Still, it was a slower quarter as it posted EBITDA guidance for next quarter missing analysts’ expectations and full-year EBITDA guidance missing analysts’ expectations.
As expected, the stock is down 8% since the results and currently trades at $114.26.
Read our full analysis of Novanta’s results here.
Vicor (NASDAQ: VICR)
Founded by a researcher at the Massachusetts Institute of Technology, Vicor (NASDAQ: VICR) provides electrical power conversion and delivery products for a range of industries.
Vicor reported revenues of $96.05 million, up 11.9% year on year. This print was in line with analysts’ expectations. More broadly, it was a mixed quarter as it also logged a beat of analysts’ EPS estimates but a significant miss of analysts’ EBITDA estimates.
Vicor had the weakest performance against analyst estimates among its peers. The stock is up 14.7% since reporting and currently trades at $51.77.
Read our full, actionable report on Vicor here, it’s free.
Littelfuse (NASDAQ: LFUS)
The developer of the first blade-type automotive fuse, Littelfuse (NASDAQ: LFUS) provides electrical protection and control components for the automotive, industrial, electronics, and telecommunications industries.
Littelfuse reported revenues of $613.4 million, up 9.8% year on year. This result beat analysts’ expectations by 6.8%. It was an exceptional quarter as it also logged EPS guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EBITDA estimates.
The stock is up 11.4% since reporting and currently trades at $262.59.
Read our full, actionable report on Littelfuse here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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