Short Interest in Methode Electronics, Inc. (NYSE:MEI) Rises By 19.6%

Key Points

• Short interest in Methode Electronics rose 19.6% in March to 1,429,217 shares, equal to about 4.1% of the stock and a short-interest ratio of 2.8 days.
• Analysts hold a consensus "Reduce" rating with a $8.50 price target after the company missed quarterly EPS (−$0.37 vs. −$0.26), reporting negative margins and an expected −0.4 EPS for the year.
• The stock traded at $7.20 (+2%), the company announced a quarterly dividend of $0.05 (annualized $0.20, yield ~2.8%) payable May 1, and market capitalization is about $255 million.

Methode Electronics, Inc. (NYSE:MEI - Get Free Report) was the target of a large increase in short interest in March. As of March 31st, there was short interest totaling 1,429,217 shares, an increase of 19.6% from the March 15th total of 1,195,282 shares. Based on an average trading volume of 514,806 shares, the short-interest ratio is currently 2.8 days. Approximately 4.1% of the company's stock are sold short.

Analyst Ratings Changes

Several research firms have recently commented on MEI. Weiss Ratings restated a "sell (d-)" rating on shares of Methode Electronics in a report on Thursday, January 22nd. Robert W. Baird set a $8.50 price target on shares of Methode Electronics in a report on Wednesday, January 14th. Two analysts have rated the stock with a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of "Reduce" and a consensus price target of $8.50.

Methode Electronics Stock Up 2.0%

Shares of MEI stock traded up $0.14 on Friday, hitting $7.20. The company's stock had a trading volume of 266,020 shares, compared to its average volume of 415,434. The company has a debt-to-equity ratio of 0.50, a current ratio of 2.41 and a quick ratio of 1.55. Methode Electronics has a fifty-two week low of $4.88 and a fifty-two week high of $10.77. The firm's fifty day moving average price is $7.00 and its 200-day moving average price is $7.15. The stock has a market capitalization of $255.17 million, a price-to-earnings ratio of -3.96 and a beta of 1.19.

Methode Electronics (NYSE:MEI - Get Free Report) last released its quarterly earnings data on Thursday, March 5th. The electronics maker reported ($0.37) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.26) by ($0.11). Methode Electronics had a negative net margin of 6.58% and a negative return on equity of 8.04%. The business had revenue of $233.70 million during the quarter, compared to analyst estimates of $219.44 million. Research analysts anticipate that Methode Electronics will post -0.4 EPS for the current year.

Methode Electronics Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Friday, May 1st. Shareholders of record on Friday, April 17th will be given a dividend of $0.05 per share. The ex-dividend date of this dividend is Friday, April 17th. This represents a $0.20 dividend on an annualized basis and a yield of 2.8%. Methode Electronics's payout ratio is currently -10.99%.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently bought and sold shares of the company. 4D Advisors LLC bought a new position in shares of Methode Electronics during the 4th quarter worth about $3,320,000. UBS Group AG increased its holdings in shares of Methode Electronics by 887.1% during the 3rd quarter. UBS Group AG now owns 476,974 shares of the electronics maker's stock worth $3,601,000 after purchasing an additional 428,654 shares during the period. Charles Schwab Investment Management Inc. increased its holdings in shares of Methode Electronics by 31.6% during the 4th quarter. Charles Schwab Investment Management Inc. now owns 1,380,436 shares of the electronics maker's stock worth $9,166,000 after purchasing an additional 331,618 shares during the period. Arrowstreet Capital Limited Partnership increased its holdings in shares of Methode Electronics by 54.6% during the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 832,344 shares of the electronics maker's stock worth $6,284,000 after purchasing an additional 293,843 shares during the period. Finally, AQR Capital Management LLC increased its holdings in shares of Methode Electronics by 29.7% during the 2nd quarter. AQR Capital Management LLC now owns 1,209,756 shares of the electronics maker's stock worth $11,505,000 after purchasing an additional 276,923 shares during the period. Institutional investors and hedge funds own 95.49% of the company's stock.

About Methode Electronics

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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