LFUS - Embedded Expectations Analysis - 2020 01 17
Littelfuse, Inc. (LFUS:USA) currently trades near corporate averages relative toUAFRS-based (Uniform) Earnings, with a 20.1x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about POS declines, end-market demand, and their cost structure
Specifically, management may be concerned about POS declines across their end markets, and they may be exaggerating the strength of design activity in their transportation and electronics markets. Moreover, they may lack confidence in their ability to improve volumes in their automotive segment, expand operating margins, and mitigate electronics price erosion. Furthermore, they may be overstating the demand for global renewables and industrial end market products, and they appear concerned about their ability to sustain new business wins in Europe. Finally, they may be downplaying concerns about inventory build and automotive sales decline in China, and they may lack confidence in their ability to align their cost structure to
business conditions
Littelfuse is a manufacturer of technologies in circuit protection, power control and sensing. The company has three segments: Electronics, which provides fuses and fuse accessories, positive temperature coefficient resettable fuses, polymer electrostatic discharge suppressors, varistors, and gas discharge tubes; Automotive, which consists of circuit protection, power control and sensing technologies for original equipment manufacturers, Tier-I suppliers and parts distributors in the passenger car, agricultural, construction and other commercial vehicle industries; and Industrial, which includes power fuses, protection relays and controls and other circuit protection products.
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