Trade-Ideas: Littelfuse (LFUS) Is Today's "Perilous Reversal" Stock
Trade-Ideas LLC identified
(
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Littelfuse as such a stock due to the following factors:
- LFUS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $21.3 million.
- LFUS has traded 52,473 shares today.
- LFUS is down 3.1% today.
- LFUS was up 8.8% yesterday.
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More details on LFUS:
Littelfuse, Inc. designs, manufactures, and sells circuit protection devices for use in the automotive, electronic, and electrical markets worldwide. It operates in three segments: Electronics, Automotive, and Electrical. The stock currently has a dividend yield of 1.1%. LFUS has a PE ratio of 3. Currently there are 3 analysts that rate Littelfuse a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Littelfuse has been 135,100 shares per day over the past 30 days. Littelfuse has a market cap of $2.3 billion and is part of the services sector and wholesale industry. The stock has a beta of 1.00 and a short float of 2.3% with 2.70 days to cover. Shares are up 18% year-to-date as of the close of trading on Monday.
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Analysis:
rates Littelfuse as a
. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- LFUS's debt-to-equity ratio is very low at 0.28 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, LFUS has a quick ratio of 2.10, which demonstrates the ability of the company to cover short-term liquidity needs.
- LITTELFUSE INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, LITTELFUSE INC increased its bottom line by earning $4.38 versus $3.93 in the prior year. This year, the market expects an improvement in earnings ($4.94 versus $4.38).
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 1.3%. Since the same quarter one year prior, revenues slightly dropped by 1.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- 43.98% is the gross profit margin for LITTELFUSE INC which we consider to be strong. Regardless of LFUS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.25% trails the industry average.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- You can view the full Littelfuse Ratings Report.
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