Vishay Precision Group: The Stock Is Moving Opposite To The Fundamentals; Remains A Sell

Emmanuel Onwusah
116 Followers
(9min)

Summary

  • VPG's recent 20% stock rally is unsupported by fundamentals, with revenues, margins, and earnings all declining and no real demand growth evident.
  • All core business segments continue to face structural and cyclical pressures, with no clear turnaround or breakout in sight, despite minor sequential improvements.
  • Valuation is stretched, trading at premium EV/EBITDA and P/E multiples without earnings growth or near-term catalysts to justify such optimism.
  • Management is focused on cost discipline, but without top-line growth or major new deals, downside risk outweighs upside potential at current levels.

Semiconductor technology systems and computer processing units are used in the airline and travel industry, 3D rendering.

Oselote/iStock via Getty Images

Vishay Precision Group's (NYSE:VPG) share price has rallied ~20% since I issued a Sell recommendation in March, and on the surface, it’s a head-scratcher. For context, the company’s revenues and margins have been declining for 2+ years

This article was written by

116 Followers
I am a financial analyst and writer with a strong foundation in financial modeling, valuation, and data analysis. I hold FMVA (Financial Modeling & Valuation Analyst) and BIDA (Business Intelligence & Data Analyst) certifications from the Corporate Finance Institute (CFI) in Canada.The markets fascinate me (we're all looking to grow to grow wealth, after all, and the stock market is the single greatest invention that allows us to do it do it fairly easily), so I combine financial data with qualitative analysis to evaluate companies and sectors critically. I'm particularly interested in the technology, infrastructure, and internet services sectors, and I focus on companies with great fundamentals and growth potential. I'm writing on Seeking Alpha to build a community and share my thoughts on tech, healthcare, and finance stocks. Moving forward, my focus remains on providing value to readers and investors who share a passion for long-term investing.P. S. I also have a bachelor's degree in petroleum and gas engineering.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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