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 Monday, June 10, 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.

Benchmark Electronics Inc’s Value Grade

Value Grade:

Benchmark Electronics, Inc. provides comprehensive solutions across the entire product life cycle through its technology and engineering design services, leveraging its global supply chain and delivering manufacturing services in various industries. The Company provides advanced manufacturing services (electronic manufacturing services (EMS) and precision technology (PT) services), which includes design and engineering services and technology solutions. Its specialization in packaging and interconnect technologies include printed circuit board assembly (PCBA) and test, component engineering services, systems assembly and test, and failure analysis. The Company offers complex PT services, including full electromechanical assembly and test services. Its design and engineering services and technology solutions include new product design, prototype, testing and related engineering services; custom test and automation equipment design and build services, and technology solutions.

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.

Benchmark Electronics Inc has a Value Score of 76, which is considered to be undervalued.

When you look at Benchmark Electronics Inc’s price-to-sales ratio at 0.51 compared to the industry median at 1.46, this company has a lower price relative to revenue compared to its peers. This could make Benchmark Electronics Inc’s stock more attractive for value investors.

Benchmark Electronics Inc’s price-earnings ratio is 22.13 compared to the industry median at 22.13. This means it has a similar share price relative to earnings compared to its peers. This could make Benchmark Electronics Inc less attractive for value investors.

Now, let’s assess Benchmark Electronics Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 6.5, when compared to the industry median of 12.3, the company may be considered undervalued 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. Benchmark Electronics Inc’s shareholder yield is higher than its industry median ratio of (1.36%). 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. Benchmark Electronics Inc’s price-to-book ratio is lower than its industry median ratio of 1.36. This could make Benchmark Electronics Inc more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Benchmark Electronics Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Benchmark Electronics Inc’s price-to-free-cash-flow ratio is lower than its industry median ratio of 21.53. This could make Benchmark Electronics Inc more attractive because the lower P/FCF ratio indicates that Benchmark Electronics Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Boxlight Corp’s Value Grade

Value Grade:

Boxlight Corporation is a provider of interactive technology solutions. The Company designs, produces and distributes interactive technologies, including its interactive and non-interactive flat-panel displays, light emitting diode (LED) video walls, media players, classroom audio and campus communication, cameras and other peripherals for the education market and non-interactive solutions, including flat-panels, LED video walls and digital signage for the Enterprise market. The Company also distributes science, technology, engineering, and math (STEM) products. The Company offers professional training services related to its technology in the United States. The Company’s product categories include Front-of-Class Display (Mimio and Clevertouch brands), FrontRow Classroom Audio and IP-based school-wide communication systems for bells, paging, intercom, and alerting, and educational software and content (Mimio Connect, LYNK Whiteboard, OKTOPUS, MimioStudio).

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.

Boxlight Corp has a Value Score of 84, which is considered to be undervalued.

Boxlight Corp’s price-to-book ratio is higher than its peers. This could make Boxlight Corp less attractive for value investors when compared to the industry median at 1.36.

You can read more about Boxlight Corp’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.

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 77, which is considered to be undervalued.

Daktronics Inc’s price-earnings ratio is 10.0 compared to the industry median at 22.1. 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 1.36.

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.

Desktop Metal Inc’s Value Grade

Value Grade:

Desktop Metal, Inc. offers additive manufacturing technologies focused on the production of end-use parts. The Company offers a comprehensive portfolio of integrated additive manufacturing solutions comprised of hardware, software, materials, and services with support for metals, polymers, elastomers, ceramics, sands, composites, and biocompatible materials. Its solutions span across the product life cycle, from product development to mass production and aftermarket operations, and address an array of industries, including automotive, healthcare and dental, consumer products, heavy industry, aerospace, machine design and research and development. Its binder jet metal additive manufacturing platforms include P-Series, the Shop System, and the X-Series. Its photopolymer additive manufacturing systems include The Einstein Series, ETEC Xtreme 8K platform and ETEC Pro XL. Its digital casting additive manufacturing systems comprise its S-Series platform, which include S-Max and S-Max Pro.

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.

Desktop Metal Inc has a Value Score of 65, which is considered to be undervalued.

Desktop Metal Inc’s price-to-book ratio is higher than its peers. This could make Desktop Metal Inc less attractive for value investors when compared to the industry median at 1.36.

You can read more about Desktop Metal 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.

iRobot Corp’s Value Grade

Value Grade:

iRobot Corporation is a global consumer robot company. The Company designs, builds, sells and supports durable robots through the integration of software, electronics and hardware. Its portfolio of home robots and smart home devices features technologies for the connected home and advanced concepts in cleaning, mapping and navigation, human-robot interaction and physical solutions. Its products include Roomba Combo, Roomba, Braava, Braava jet and Root. It offers the Braava family of automatic floor mopping robots, which are designed for hard-surface floors. It also sells Roomba accessories and consumables, including the Clean Base Automatic Dirt Disposal, replacement dirt disposal bags for the clean base, filters, brushes and batteries. It also provides ongoing customer service and support through the iRobot HOME App. The Company offers its products through distributor and retail sales channels, as well as the online store on its Website and through its Home App.

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.

iRobot Corp has a Value Score of 65, which is considered to be undervalued.

iRobot Corp’s price-to-book ratio is higher than its peers. This could make iRobot Corp less attractive for value investors when compared to the industry median at 1.36.

You can read more about iRobot Corp’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.

• Benchmark Electronics Inc stock has a Value Grade of B.
• Boxlight Corp stock has a Value Grade of A.
• Daktronics Inc stock has a Value Grade of B.
• Desktop Metal Inc stock has a Value Grade of B.
• iRobot Corp 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 Monday, June 10
• 3 Undervalued Electronic Equipment & Parts Stocks for Friday, June 07
• Why iRobot Corp’s (IRBT) Stock Is Down 4.60%
• Why Methode Electronics Inc’s (MEI) Stock Is Up 4.62%

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.