As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the electrical systems industry, including Sanmina (NASDAQ:SANM) and its peers.
Like many equipment and component manufacturers, electrical systems companies are buoyed by secular trends such as connectivity and industrial automation. More specific pockets of strong demand include Internet of Things (IoT) connectivity and the 5G telecom upgrade cycle, which can benefit companies whose cables and conduits fit those needs. But like the broader industrials sector, these companies are also at the whim of economic cycles. Interest rates, for example, can greatly impact projects that drive demand for these products.
The 14 electrical systems stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 4.1% while next quarter’s revenue guidance was 1.2% below.
While some electrical systems stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.3% since the latest earnings results.
Sanmina (NASDAQ:SANM)
Founded in 1980, Sanmina (NASDAQ:SANM) is an electronics manufacturing services company offering end-to-end solutions for various industries.
Sanmina reported revenues of $2.10 billion, up 3.9% year on year. This print exceeded analysts’ expectations by 2.2%. Overall, it was an exceptional quarter for the company with EPS guidance for next quarter exceeding analysts’ expectations and revenue guidance for next quarter exceeding analysts’ expectations.
"We delivered strong results for the fourth quarter. Ongoing strength in the Communications Networks and Cloud and AI Infrastructure end-markets, combined with our team's execution and disciplined cost management, drove performance that met or exceeded our outlook," stated Jure Sola, Chairman and CEO.
Interestingly, the stock is up 7.2% since reporting and currently trades at $150.44.
Is now the time to buy Sanmina? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q3: Thermon (NYSE:THR)
Creating the first packaged tracing systems, Thermon (NYSE:THR) is a leading provider of engineered industrial process heating solutions for process industries.
Thermon reported revenues of $131.7 million, up 14.9% year on year, outperforming analysts’ expectations by 10.3%. The business had a stunning quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
Thermon delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 26.2% since reporting. It currently trades at $37.13.
Is now the time to buy Thermon? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: Atkore (NYSE:ATKR)
Protecting the things that power our world, Atkore (NYSE:ATKR) designs and manufactures electrical safety products.
Atkore reported revenues of $752 million, down 4.6% year on year, exceeding analysts’ expectations by 2.5%. Still, it was a slower quarter as it posted a significant miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EBITDA estimates.
As expected, the stock is down 4.9% since the results and currently trades at $63.26.
Read our full analysis of Atkore’s results here.
LSI (NASDAQ:LYTS)
Enhancing commercial environments, LSI (NASDAQ:LYTS) provides lighting and display solutions for businesses and retailers.
LSI reported revenues of $157.2 million, up 13.9% year on year. This number beat analysts’ expectations by 5.2%. It was an exceptional quarter as it also logged an impressive beat of analysts’ revenue estimates and a solid beat of analysts’ EBITDA estimates.
The stock is down 20.4% since reporting and currently trades at $18.31.
Read our full, actionable report on LSI here, it’s free for active Edge members.
Hubbell (NYSE:HUBB)
A respected player in the electrical segment, Hubbell (NYSE:HUBB) manufactures electronic products for the construction, industrial, utility, and telecommunications markets.
Hubbell reported revenues of $1.50 billion, up 4.1% year on year. This print missed analysts’ expectations by 1.6%. It was a slower quarter as it also recorded a miss of analysts’ revenue estimates and a miss of analysts’ organic revenue estimates.
Hubbell had the weakest performance against analyst estimates among its peers. The stock is up 2.3% since reporting and currently trades at $444.11.
Read our full, actionable report on Hubbell here, it’s free for active Edge members.
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