BELFB - Bel Fuse: Not Cheap But Plenty Of Silver Linings

2024-05-06 12:59:01 ET

Summary

• Bel Fuse has underperformed on a YTD basis, as industry destocking pressures are expected to adversely impact its topline progress through this year.
• Relative to its historical averages, the stock is priced at a 30% premium on a forward EV/EBITDA basis and a 76% premium on a forward P/E basis.
• Despite contraction on the topline front, management has been effectively taking out costs from the business, resulting in a very favorable gross margin and EBITDA margin outlook.
• The risk-reward on the standalone chart looks good, and the stock could get additional support from a ramp-up in share buybacks.

Introduction

Bel Fuse Inc. ( BELFB ), a small-cap stock ($760m), is noted for producing a range of technical products (see image below) that play an instrumental role in the successful operation of electronic circuits....

For further details see: