KEYS - Keysight Technologies: Weak Demand Should Be Temporary But I'd Rather Hold

2024-03-25 12:33:10 ET

Summary

• Keysight provides electronic design and test instruments for various industries, with a strong reputation and a wide range of clients.
• Demand has been weak because the company offers products that depend on the capital expenditures of its clients and the macroeconomic environment doesn't help encourage investments.
• While this issue should be temporary, I don't think the stock is a bargain right now, therefore I'd prefer to wait for a better price.
• Based on my valuation model, I would like buy this wonderful business at a price close to $130 USD per share.

Investment Thesis

Keysight (NYSE: KEYS) is a leading company in its niche market, but it has had a very difficult last two years due to the uncertain economic environment that has caused companies to be cautious with their investments. Because the company offers products that depend on the capital expenditures of its clients, it seems normal that demand is paused....

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