Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 5 stocks made the list for top value stocks in the Electronic Equipment & Parts industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Electronic Equipment & Parts Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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5 Undervalued Electronic Equipment & Parts Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 5 undervalued stocks in the Electronic Equipment & Parts industry for Tuesday, April 09, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Electronic Equipment & Parts industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

AUO Corp (ADR)’s Value Grade

Value Grade:

AUO Corp is a Taiwan-based company mainly engaged in the research, development, manufacture and sale of thin film transistor liquid crystal displays (TFT-LCD). The Company operates its business through two segments: Display and Energy. The Display segment is mainly engaged in the manufacture of TFT-LCD, and the products are mainly used in various flat-panel displays, including LCD televisions, desktop monitors, notebook computers, tablet computers, mobile phones, automotive monitors, industrial and commercial monitors, among others. The Energy segment is principally engaged in the manufacture and sale of solar modules and systems. The Company mainly provides its products in mainland China, Taiwan, Singapore, Japan and other regions.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

AUO Corp (ADR) has a Value Score of 81, which is considered to be undervalued.

When you look at AUO Corp (ADR)’s price-to-sales ratio at 0.56 compared to the industry median at 1.55, this company has a lower price relative to revenue compared to its peers. This could make AUO Corp (ADR)’s stock more attractive for value investors.

Now, let’s assess AUO Corp (ADR)’s EV/EBITDA ratio, also known as enterprise multiple. At 17.6, when compared to the industry median of 11.9, the company may be considered overvalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. AUO Corp (ADR)’s shareholder yield is higher than its industry median ratio of (0.91%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. AUO Corp (ADR)’s price-to-book ratio is lower than its industry median ratio of 1.45. This could make AUO Corp (ADR) more attractive to investors looking for a new addition to their portfolio.

Daktronics Inc’s Value Grade

Value Grade:

Daktronics, Inc. is engaged in designing and manufacturing electronic scoreboards, programmable display systems and large screen video displays for sporting, commercial and transportation applications. The Company's segments include Commercial, Live Events, High School Park and Recreation, Transportation, and International. Its Commercial segment primarily consists of sales of its integrated video display systems, digital billboards, Galaxy and Fuelight product lines, and dynamic messaging systems to resellers (primarily sign companies), out-of-home (OOH) companies, national retailers, quick-serve restaurants, casinos, shopping centers, cruise ships, commercial building owners, and petroleum retailers. Its Live Events segment primarily consists of sales of integrated scoring and video display systems to college and professional sports facilities and convention centers and sales of its mobile display technology to video rental organizations and other live event type venues.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Daktronics Inc has a Value Score of 81, which is considered to be undervalued.

Daktronics Inc’s price-earnings ratio is 9.0 compared to the industry median at 21.6. This means that it has a lower price relative to its earnings compared to its peers. This makes Daktronics Inc more attractive for value investors.

Daktronics Inc’s price-to-book ratio is lower than its peers. This could make Daktronics Inc more attractive for value investors when compared to the industry median at 1.45.

You can read more about Daktronics Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Aeye Inc’s Value Grade

Value Grade:

AEye, Inc. is a provider of active lidar systems technology for vehicle autonomy, advanced driver-assistance systems, and robotic vision applications. Its software-definable 4Sight Intelligent Sensing Platform combines solid-state active lidar, an optionally fused low-light high dimension camera, and integrated deterministic artificial intelligence to capture intelligent information. 4Sight Intelligent Sensing Platform enables the integration of various types of sensor inputs, including camera, lidar, and radar. 4Sight products are developed on this framework and incorporate both camera and lidar sensors. 4Sight Intelligent Sensing Platform includes 4Sight at Design, Triggered 4Sight, Responsive 4Sight and Predictive 4Sight. 4Sight at Design enables customers to create a single, deterministic scan pattern to deliver optimal information for any specific use case. 4Sight leverages a common architecture to create application-specific products across the automotive and industrial markets.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Aeye Inc has a Value Score of 86, which is considered to be undervalued.

Aeye Inc’s price-to-book ratio is higher than its peers. This could make Aeye Inc less attractive for value investors when compared to the industry median at 1.45.

You can read more about Aeye Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Methode Electronics Inc’s Value Grade

Value Grade:

Methode Electronics, Inc. is a supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East, and Asia. The Company 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 (OEMs). The Industrial segment manufactures external lighting solutions, industrial safety radio remote controls, braided flexible cables, current-carrying laminated busbars and devices, custom power-product assemblies, such as its PowerRail solution, high-current low-voltage flexible power cabling systems and powder-coated busbars. The Interface segment provides a variety of copper-based transceivers and user interface solutions. The Medical segment is made up of its medical device business, Dabir Surfaces, with its surface support technology aimed at pressure injury prevention.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Methode Electronics Inc has a Value Score of 91, which is considered to be undervalued.

Methode Electronics Inc’s price-to-book ratio is higher than its peers. This could make Methode Electronics Inc less attractive for value investors when compared to the industry median at 1.45.

You can read more about Methode Electronics Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Wetouch Technology Inc’s Value Grade

Value Grade:

Wetouch Technology Inc is a holding company principally engaged in the research, development, manufacturing, sales and servicing of medium to large sized projected capacitive touchscreens. The Company's product portfolio comprises medium to large sized projected capacitive touchscreens ranging from 7.0 inch to 42 inch screens, including Glass-Glass (GG), Glass-Film-Film (GFF), Plastic-Glass (PF), and Glass-Film (GF). The Company's products are mainly used in the financial terminals, automotive, point of sale (POS), gaming, lottery, medical, Human Machine Interface (HMI), and other specialized industries. The Company primarily distributes its products within the domestic market and to overseas markets.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Wetouch Technology Inc has a Value Score of 70, which is considered to be undervalued.

Wetouch Technology Inc’s price-earnings ratio is 6.0 compared to the industry median at 21.6. This means that it has a lower price relative to its earnings compared to its peers. This makes Wetouch Technology Inc more attractive for value investors.

Wetouch Technology Inc’s price-to-book ratio is higher than its peers. This could make Wetouch Technology Inc less attractive for value investors when compared to the industry median at 1.45.

You can read more about Wetouch Technology Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Electronic Equipment & Parts Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Electronic Equipment & Parts stocks as well as other industrys.

Choosing Which of the 5 Best Electronic Equipment & Parts Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• AUO Corp (ADR) stock has a Value Grade of A.
• Daktronics Inc stock has a Value Grade of A.
• Aeye Inc stock has a Value Grade of A.
• Methode Electronics Inc stock has a Value Grade of A.
• Wetouch Technology Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 5 undervalued stocks in the Electronic Equipment & Parts industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Electronic Equipment & Parts Stocks

Want to learn more about Electronic Equipment & Parts stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 5 Undervalued Electronic Equipment & Parts Stocks for Tuesday, April 09
• 4 Undervalued Electronic Equipment & Parts Stocks for Monday, April 08
• Why iRobot Corp’s (IRBT) Stock Is Up 12.67%
• Why Methode Electronics Inc’s (MEI) Stock Is Up 4.49%

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.