What Happened?

Shares of custom-engineered solutions manufacturer Methode Electronics (NYSE: MEI) fell 23.6% in the morning session after the company reported a wider-than-expected fourth-quarter loss and issued a disappointing financial outlook for fiscal 2026. The electronic components maker posted a fourth-quarter adjusted loss of $0.77 per share on revenue of $257.1 million. This represents a significant decline from the prior year, driven by lower volumes in its Automotive segment. 

Looking ahead, Methode provided a grim forecast for its 2026 fiscal year, anticipating net sales between $900 million and $1 billion. The company attributed the expected sales decline of approximately $100 million to reduced demand for electric vehicles (EVs), particularly from a major customer, Stellantis. This guidance, which signals ongoing business challenges, appeared to overshadow some positive news, including record sales for its data center power products and a newly declared quarterly dividend.

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What Is The Market Telling Us

Methode Electronics’s shares are extremely volatile and have had 39 moves greater than 5% over the last year. But moves this big are rare even for Methode Electronics and indicate this news significantly impacted the market’s perception of the business.

Methode Electronics is down 33.9% since the beginning of the year, and at $7.82 per share, it is trading 44.2% below its 52-week high of $14.02 from December 2024. Investors who bought $1,000 worth of Methode Electronics’s shares 5 years ago would now be looking at an investment worth $278.88.

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