Methode Electronics (NYSE:MEI) Shares Up 14.5% - Should You Buy?

Key Points

• Methode Electronics shares jumped 14.5% to approximately $17.29, above both the 50-day and 200-day moving averages, though trading volume was below average.
• Analyst sentiment remains cautious: the stock has a consensus “Reduce” rating and a $19.33 target price, with two sells, two holds and one buy. Barrington Research was more optimistic, assigning an outperform rating and a $25 target.
• The company missed quarterly earnings estimates, reporting an adjusted loss of $0.30 per share versus an expected loss of $0.11, despite revenue exceeding forecasts. Methode also pays a $0.05 quarterly dividend, equal to a 1.1% annualized yield.

Methode Electronics, Inc. (NYSE:MEI - Get Free Report)'s share price rose 14.5% during mid-day trading on Wednesday . The company traded as high as $16.75 and last traded at $17.2930. Approximately 345,156 shares traded hands during mid-day trading, a decline of 48% from the average daily volume of 667,151 shares. The stock had previously closed at $15.10.

Wall Street Analysts Forecast Growth

Several equities analysts recently weighed in on MEI shares. Robert W. Baird raised their price objective on Methode Electronics from $8.50 to $16.00 and gave the company a "neutral" rating in a research note on Friday, June 26th. Zacks Research cut Methode Electronics from a "hold" rating to a "strong sell" rating in a research report on Tuesday, June 30th. Weiss Ratings reissued a "sell (d-)" rating on shares of Methode Electronics in a research note on Friday, July 17th. Wall Street Zen downgraded shares of Methode Electronics from a "buy" rating to a "hold" rating in a report on Sunday. Finally, Barrington Research raised shares of Methode Electronics from a "market perform" rating to an "outperform" rating and set a $25.00 price target on the stock in a report on Monday, June 29th. One analyst has rated the stock with a Buy rating, two have given a Hold rating and two have given a Sell rating to the stock. According to MarketBeat, the stock presently has an average rating of "Reduce" and a consensus target price of $19.33.

Methode Electronics Stock Performance

The company has a market capitalization of $617.92 million, a PE ratio of -17.22 and a beta of 1.50. The stock's fifty day simple moving average is $14.36 and its 200-day simple moving average is $10.15. The company has a debt-to-equity ratio of 0.48, a quick ratio of 1.66 and a current ratio of 2.37.

Methode Electronics (NYSE:MEI - Get Free Report) last posted its quarterly earnings data on Wednesday, June 24th. The electronics maker reported ($0.30) earnings per share for the quarter, missing analysts' consensus estimates of ($0.11) by ($0.19). Methode Electronics had a negative net margin of 3.50% and a negative return on equity of 5.59%. The firm had revenue of $298.10 million during the quarter, compared to analyst estimates of $238.46 million. As a group, equities analysts predict that Methode Electronics, Inc. will post -0.95 earnings per share for the current year.

Methode Electronics Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Friday, July 31st. Stockholders of record on Friday, July 17th were given a $0.05 dividend. The ex-dividend date of this dividend was Friday, July 17th. This represents a $0.20 dividend on an annualized basis and a dividend yield of 1.1%. Methode Electronics's payout ratio is currently -19.80%.

Institutional Trading of Methode Electronics

A number of hedge funds have recently added to or reduced their stakes in the business. EverSource Wealth Advisors LLC lifted its holdings in shares of Methode Electronics by 1,027.4% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 3,089 shares of the electronics maker's stock worth $29,000 after acquiring an additional 2,815 shares during the period. XTX Topco Ltd acquired a new position in Methode Electronics during the second quarter worth approximately $107,000. Mackenzie Financial Corp purchased a new position in Methode Electronics during the third quarter worth approximately $103,000. Inscription Capital LLC acquired a new position in shares of Methode Electronics in the 4th quarter valued at $112,000. Finally, State of Wyoming purchased a new stake in shares of Methode Electronics during the 1st quarter valued at $93,000. 95.49% of the stock is owned by institutional investors and hedge funds.

Methode Electronics Company Profile

Methode Electronics, Inc is a Chicago-based global manufacturer of custom-engineered electronic and electromechanical components and assemblies. Founded in 1946, Methode specializes in providing solutions that integrate electrical connectors, sensors, switches, human-machine interface devices and power distribution modules. The company's product portfolio addresses complex application requirements across a broad range of end markets, including automotive, industrial, energy, healthcare and data/telecommunications.

In its automotive segment, Methode develops advanced connector systems, circuit protection devices and thermal management solutions for internal combustion, hybrid and electric vehicles.

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