Methode Electronics, Inc. (MEI)
NYSEInformation TechnologyHardware, Equipment & PartsSnapshot 2026-09-04
$15.69+2.42%
Close 2026-09-04 · 1-day change
NYSEInformation TechnologyHardware, Equipment & PartsSnapshot 2026-09-04
Intact: The reason to own it still holds.
Methode Electronics aims to grow sales to $1.05 billion in fiscal 2027. Revenue rose 16% last year, showing progress. Management targets adjusted EBITDA near $77 million despite recent misses. The company trades cheaply versus peers, offering value if it recovers.
The company is loss-making with recent earnings misses. Adjusted EBITDA is behind targets and EPS remains negative. Analysts expect only 3% revenue growth, signaling weak demand. The stock has sold off sharply, reflecting elevated risk.
The market prices in about 3% revenue growth and a cautious outlook. Our fair value is $16.11, indicating the stock is cheap versus peers. We differ by seeing risk in profitability and execution despite growth targets.
Breaks if: Adjusted EBITDA falls below $72 million in fiscal 2027
Sustain adjusted EBITDA between $72 million and $82 million for fiscal year 2027 as a key profitability target.
Stated as a priority in 3 of last 3 quarters. Adjusted EBITDA guidance for fiscal 2027 is $72 million to $82 million. Adjusted EBITDA was $13.7 million in 2026-Q3, slightly down from $15.7 million in 2025-Q3. The company is maintaining its guidance despite recent quarterly fluctuations, indicating a stable but challenging profitability trajectory.
“The Company affirmed fiscal 2027 Adjusted EBITDA guidance of $72 million to $82 million.”
“For fiscal 2027, Adjusted EBITDA expected to be in the range of $72 million to $82 million.”
“Reaffirmed fiscal 2027 Adjusted EBITDA guidance range of $72 million to $82 million.”
Breaks if: EPS remains negative or declines further by FY28
Breaks if: Fiscal 2027 net sales fall below $1,025 million
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a turnaround story with a focus on improving profitability. The current thesis state is cautious, as the company is navigating challenges while aiming for specific sales and EBITDA targets.
The market seems to have priced in a low expectations gap, indicating that investors are not overly optimistic about MEI's near-term performance. The valuation suggests it is relatively cheap compared to peers, but the fundamentals have not yet caught up.
Management is on track to meet its sales target for fiscal 2027, with recent revenue growth showing promise. However, the company is facing challenges in maintaining its adjusted EBITDA, which requires close monitoring.
The thesis hinges on MEI's ability to meet its guidance without cutting expectations, as well as external factors like potential interest rate cuts and the performance of key sector peers. Any guidance changes could significantly impact market sentiment.
Over the next 1 to 3 years, MEI's performance will depend on its execution against targets and broader market conditions. Not investment advice.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The company missed expectations for Q2, causing a sharp stock drop. This decline suggests the market is repricing the reasons to own MEI. However, the latest earnings beat and reaffirmed fiscal 2027 guidance still support growth targets.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.