Reviewing Methode Electronics (MEI) and Its Rivals

Methode Electronics (NYSE:MEI) is one of 377 public companies in the “Electronic Equipment, Instruments & Components” industry, but how does it compare to its peers? We will compare Methode Electronics to related businesses based on the strength of its valuation, analyst recommendations, risk, institutional ownership, dividends, profitability and earnings.

Dividends

Methode Electronics pays an annual dividend of $0.20 per share and has a dividend yield of 1.9%. Methode Electronics pays out -19.2% of its earnings in the form of a dividend. As a group, “Electronic Equipment, Instruments & Components” companies pay a dividend yield of 2.0% and pay out 69.0% of their earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of current ratings for Methode Electronics and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Methode Electronics	1	2	2	1	2.50
Methode Electronics Competitors	2049	7614	10449	665	2.47

Methode Electronics currently has a consensus price target of $22.00, indicating a potential upside of 103.84%. As a group, “Electronic Equipment, Instruments & Components” companies have a potential upside of 41.15%. Given Methode Electronics’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Methode Electronics is more favorable than its peers.

Profitability

This table compares Methode Electronics and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Methode Electronics	-3.52%	-5.63%	-2.94%
Methode Electronics Competitors	-139.71%	-30.16%	-6.87%

Volatility & Risk

Methode Electronics has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500. Comparatively, Methode Electronics’ peers have a beta of -0.30, meaning that their average stock price is 130% less volatile than the S&P 500.

Earnings and Valuation

This table compares Methode Electronics and its peers gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Methode Electronics	$1.02 billion	-$35.70 million	-10.38
Methode Electronics Competitors	$4.06 billion	$172.92 million	4.89

Methode Electronics’ peers have higher revenue and earnings than Methode Electronics. Methode Electronics is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Insider & Institutional Ownership

95.5% of Methode Electronics shares are held by institutional investors. Comparatively, 43.2% of shares of all “Electronic Equipment, Instruments & Components” companies are held by institutional investors. 1.9% of Methode Electronics shares are held by insiders. Comparatively, 16.4% of shares of all “Electronic Equipment, Instruments & Components” companies are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Methode Electronics beats its peers on 9 of the 15 factors compared.

About Methode Electronics

Methode Electronics, Inc. designs, engineers, and produces mechatronic products worldwide. It operates through four segments: Automotive, Industrial, Interface, and Medical. The Automotive segment supplies electronic and electro-mechanical devices, and related products to automobile original equipment manufacturers directly or through their tiered suppliers. Its products include integrated center consoles, hidden and ergonomic switches, transmission lead-frames, complex insert molded solutions, LED-based lighting solutions, and sensors, which incorporate magneto-elastic sensing, eddy current, or other sensing technologies that monitor the operation or status of a component or system. The Industrial segment manufactures external lighting solutions comprising driving, work, and signal lights; industrial safety radio remote controls; braided flexible cables; current-carrying laminated and powder-coated busbars; high-voltage high current connector and contracts; custom power-product assemblies, such as PowerRail solution; and high-current low-voltage flexible power cabling systems that are used in aerospace, cloud computing, commercial vehicles, construction equipment, industrial, military, power conversion, and transportation markets and applications. The Interface segment provides various copper-based transceivers and related accessories for the cloud computing hardware equipment and telecommunications broadband equipment markets; user interface solutions for the appliance, commercial food service, and point-of-sale equipment markets; and fluid-level sensors for the marine/recreational vehicle and sump pump markets. The Medical segment offers Dabir Surfaces, a surface support technology aimed at pressure injury prevention for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. Methode Electronics, Inc. was incorporated in 1946 and is headquartered in Chicago, Illinois.