DAKT - Daktronics: Compelling Valuation Supported By Steady Growth And Improving Margins

2024-07-11 03:40:23 ET

Summary

• Shares are up more than 50% this year following a strong performance in the underlying business.
• Margins have remained solid as the company continues to deliver profitable growth supported by a strong growth in orders.
• Valuation appears compelling, given the potential upside from increased margins.

Investment thesis

Daktronics ( DAKT ) is the largest player in the North American market for the LED Video Display, with a market share close to 46%. A key differentiator versus its competitors is Daktronics' predominantly US-based manufacturing. Additionally, its comprehensive service offerings provide customers with more options for customization. Daktronics also has a significant presence internationally, excluding China....

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