3 Reasons to Avoid LFUS and 1 Stock to Buy Instead

December 15, 2025 at 23:01 PM EST

LFUS Cover Image

Littelfuse has followed the market’s trajectory closely, rising in tandem with the S&P 500 over the past six months. The stock has climbed by 17.4% to $260.46 per share while the index has gained 13.1%.

Is now the time to buy Littelfuse, or should you be careful about including it in your portfolio? Dive into our full research report to see our analyst team’s opinion, it’s free for active Edge members.

Why Is Littelfuse Not Exciting?

We're cautious about Littelfuse. Here are three reasons we avoid LFUS and a stock we'd rather own.

1. Revenue Tumbling Downwards

We at StockStory place the most emphasis on long-term growth, but within industrials, a stretched historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Littelfuse’s recent performance marks a sharp pivot from its five-year trend as its revenue has shown annualized declines of 2.5% over the last two years. Littelfuse Year-On-Year Revenue Growth

2. EPS Took a Dip Over the Last Two Years

While long-term earnings trends give us the big picture, we also track EPS over a shorter period because it can provide insight into an emerging theme or development for the business.

Sadly for Littelfuse, its EPS declined by more than its revenue over the last two years, dropping 12.4%. This tells us the company struggled to adjust to shrinking demand.

Littelfuse Trailing 12-Month EPS (Non-GAAP)

3. New Investments Fail to Bear Fruit as ROIC Declines

ROIC, or return on invested capital, is a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity).

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Unfortunately, Littelfuse’s ROIC has decreased significantly over the last few years. We like what management has done in the past, but its declining returns are perhaps a symptom of fewer profitable growth opportunities.

Littelfuse Trailing 12-Month Return On Invested Capital

Final Judgment

Littelfuse isn’t a terrible business, but it isn’t one of our picks. That said, the stock currently trades at 21.7× forward P/E (or $260.46 per share). While this valuation is fair, the upside isn’t great compared to the potential downside. We're fairly confident there are better investments elsewhere. Let us point you toward a safe-and-steady industrials business benefiting from an upgrade cycle.

Stocks We Would Buy Instead of Littelfuse

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