Needham & Company Downgrades Bel Fuse (BELFB) to Hold

Needham & Company downgraded Bel Fuse (NASDAQ: BELFB) from Buy to Hold.

Analyst Sean K.F. Hannan commented, "In our view, BELFB's 4Q disappointed not only as a result of market conditions but also due to what appears to be continued disappointing revenue benefits from 2014 acquisitions (namely Power-One - likely down 30%+ since acq). On top of this dynamic (that we expect to persist at least a few qtrs), BELFB is experiencing weak operating leverage on non-GAAP SG&A (also a situation we don't see changing near-term) within the particularly sensitive model. BELFB does appear to be executing OK as it manages what's in its control, but the present lack of positive catalysts to materially turn the boat is of concern to us. Thus, we downgrade to Hold as valuation no longer looks attractive considering: (1) $8.59 net debt/share; (2) trading at 7.3-7.4x tangible book; and (3) trading ~10-11x revised '16 EPS est. of $1.35."

1Q est. now $129M/$0.19 vs. prior $137M/$0.33. 2016 now $548M/$1.35 vs. prior $582M/$2.15. Establishing '17 of $562M/$1.57.

For an analyst ratings summary and ratings history on Bel Fuse click here. For more ratings news on Bel Fuse click here.

Shares of Bel Fuse closed at $14.06 yesterday.

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