Updated 3/11/25
Littelfuse, Inc. (NASDAQ: LFUS) might not be the first name that comes to mind when thinking about dividend stocks, but it has quietly built a reputation for reliability and steady income growth. The company specializes in circuit protection, power control, and sensor solutions, serving industries like automotive, industrial, and electronics.
With a long history of innovation and a strong foothold in niche markets, Littelfuse has managed to sustain its business across economic cycles. While the stock has seen some recent pullbacks, its consistent dividend growth makes it an interesting choice for investors who prefer stability over speculation.
Key Dividend Metrics 📊💰
🛡️ Dividend Yield: 1.30%
📈 5-Year Average Dividend Yield: 0.93%
💵 Forward Annual Dividend Rate: $2.80
💰 Trailing Annual Dividend Rate: $2.70
📅 Next Dividend Date: March 6, 2025
⏳ Ex-Dividend Date: February 20, 2025
📊 Payout Ratio: 59.87%
🚀 Dividend Growth Streak: Over 13 years
Dividend Overview
Littelfuse isn’t a high-yield stock, but it makes up for that with consistent and reliable dividend growth. With a yield of 1.30%, it’s slightly above its 5-year average, showing that investors today are getting a better return than usual for holding the stock.
The company’s payout ratio sits at around 60%, which suggests a balanced approach to returning capital to shareholders while still reinvesting in future growth. It’s clear Littelfuse takes a long-term approach to dividends, steadily increasing payouts for more than a decade.
For income investors, Littelfuse offers the type of dependability that’s hard to find. While the yield isn’t huge, its long history of dividend growth suggests that patient investors will benefit over time.
Dividend Growth and Safety
Littelfuse has shown a strong commitment to increasing its dividend, and there are plenty of reasons to believe that trend will continue.
- Solid Cash Flow
- Over the last year, operating cash flow came in at $367.6 million.
- Free cash flow was $259.7 million, giving the company plenty of cushion to cover dividends.
- Healthy Balance Sheet
- With $725.9 million in cash on hand, Littelfuse has the liquidity to support both growth and dividends.
- Debt sits at $916.7 million, but a manageable debt-to-equity ratio of 37.78% keeps things in check.
- Steady Payout Ratio
- At just under 60%, Littelfuse keeps its dividend at a sustainable level.
- There’s still room for dividend growth, though future increases may be gradual rather than aggressive.
The combination of solid cash reserves, consistent free cash flow, and a reasonable payout ratio makes Littelfuse’s dividend one of the more reliable options in the industrial sector.
Chart Analysis
Overall Trend
Littelfuse, Inc. (LFUS) has been in a clear downtrend over the past several months. The stock was trading at higher levels around mid-year but has since steadily declined. Recently, the price has dropped below both the 50-day and 200-day moving averages, which is a bearish signal. The 50-day moving average is trending downward and has crossed below the 200-day moving average, confirming a death cross pattern that often signals continued weakness.
Moving Averages
The 50-day moving average (orange line) was above the 200-day moving average (blue line) for most of last year but has since reversed course. This suggests that the shorter-term momentum is weakening relative to the long-term trend. The fact that the stock is currently trading well below both moving averages adds to the bearish sentiment.
Historically, when a stock remains below these key levels, it often struggles to gain upside traction unless there is a major catalyst. A break above the moving averages would be a bullish signal, but for now, the stock is showing no signs of reversing its downward trend.
Recent Price Action
The most recent trading session shows LFUS closing at 215.28, near its intraday low of 213.69. This suggests weakness into the close, which is typically not a good sign for near-term momentum.
The last five candles have been mostly red, meaning sellers have been in control. There was an attempt to push higher in recent sessions, but each time the stock has been met with resistance. The long wicks on some of the recent candles indicate that buyers attempted to step in but were ultimately overpowered by selling pressure.
Volume and Market Participation
Trading volume has picked up significantly in recent days, particularly during the latest decline. When a stock moves lower on higher-than-average volume, it usually suggests strong conviction from sellers.
There were moments earlier in the year when buying volume increased, but those spikes were not enough to change the broader trend. Without sustained buying pressure, it will be difficult for the stock to stage a meaningful recovery in the short term.
Relative Strength Index (RSI)
The RSI indicator at the bottom of the chart is sitting at a low level, indicating that the stock is approaching oversold conditions. While an oversold RSI can sometimes lead to a short-term bounce, it does not guarantee a trend reversal.
The RSI has been weak for most of this downtrend, and it has yet to show a significant uptick, which would signal buyers stepping in with conviction. If the RSI moves below 30, it could indicate extreme oversold conditions, which might attract bargain hunters looking for a potential rebound.
Support and Resistance Levels
The stock appears to have broken through key support levels and is now trading near its lowest point in recent months. If this level fails to hold, the next major support zone could be around the 210 level, which is just slightly below current prices.
On the upside, resistance will likely be found at the 50-day moving average, currently around 235. If LFUS were to break back above this level, it would indicate a potential shift in momentum. However, with the current trend and recent price action, resistance levels may be difficult to overcome unless there is a strong catalyst.
Analyst Ratings
🟢 Upgrades
🟩 Oppenheimer – On October 17, 2024, Oppenheimer upgraded Littelfuse from Perform to Outperform, setting a price target of 310. The firm highlighted strong financial performance and the company’s positioning in the growing electric vehicle market as key reasons for the upgrade.
🟩 Stifel – On August 13, 2024, Stifel raised its rating from Hold to Buy, adjusting the price target to 280 from 270. Analysts pointed to improved operational efficiencies and a robust product pipeline, which they believe will contribute to long-term growth.
🔴 Downgrades
🟥 Cowen – On November 3, 2024, Cowen downgraded Littelfuse from Outperform to Market Perform, reducing the price target to 225 from 295. The downgrade was driven by concerns over supply chain disruptions and their potential impact on profit margins.
🟥 Robert W. Baird – On July 6, 2024, Robert W. Baird lowered its rating from Outperform to Neutral, setting a price target of 269. Analysts cited slowing growth in key markets and rising competition as the main factors behind their decision.
📊 Consensus Price Target
📌 The current consensus price target for Littelfuse stands at 280, implying a potential upside of approximately 28.77 percent from the latest share price of 215.28. This reflects a mix of optimism surrounding the company’s long-term growth and caution regarding short-term industry challenges.
Earnings Report Summary
Littelfuse, Inc. recently shared its latest financial results, giving investors a look at how the company performed during the fourth quarter and the full year of 2024. The numbers show a mix of stability and challenges, with steady cash flow but some pressure on revenue and earnings.
Fourth Quarter 2024 Highlights
Revenue for the quarter came in at $530 million, which was slightly down by about 1 percent compared to the same time last year. While overall sales remained stable on an organic basis, some areas saw softer demand.
Earnings per share, based on generally accepted accounting principles, showed a loss of $1.57, but that includes a $93 million non-cash impairment charge related to goodwill and intangible assets. If you take out that one-time hit, adjusted earnings per share landed at $2.04.
On a positive note, Littelfuse continued to generate strong cash flow. Operating cash flow for the quarter was $161 million, with free cash flow reaching $135 million. This highlights the company’s ability to manage costs and maintain financial flexibility even in a slower demand environment.
Full Year 2024 Overview
For the entire year, Littelfuse reported $2.2 billion in total sales, down about 7 percent from the previous year. That decline was largely due to ongoing economic challenges and weaker demand in some of the company’s key markets.
Earnings per share for the year came in at $4.51 on a GAAP basis, but if you strip out impairment charges and restructuring costs, the adjusted figure was $8.48. While not as strong as previous years, these numbers show that the company remained profitable despite external pressures.
Cash flow continued to be a strong point, with $368 million in operating cash flow and $292 million in free cash flow over the full year. That cash cushion gives Littelfuse the ability to invest in future growth opportunities while maintaining stability.
Management’s Take on the Results
CEO Dave Heinzmann acknowledged the challenges in the current economic landscape but pointed to Littelfuse’s ability to execute its strategy effectively. He highlighted strong cash flow, solid operational improvements, and promising growth opportunities, particularly in automotive and industrial applications. He remains optimistic that the company’s investments in innovation and efficiency will help drive stronger earnings in 2025.
Looking Ahead to 2025
For the first quarter of 2025, Littelfuse expects revenue to fall between $520 million and $550 million. Adjusted earnings per share are projected to range from $1.70 to $1.90, with an estimated tax rate of around 26 percent.
These forecasts suggest the company is preparing for a measured recovery, while still facing some lingering headwinds. Management remains focused on improving profitability and adapting to market conditions as they unfold.
Financial Health and Stability
A company’s ability to keep paying dividends depends on its financial health, and Littelfuse is in a good spot.
- Revenue and Profitability
- The company pulled in $2.19 billion in revenue over the last 12 months, with a gross profit of $801 million.
- Operating margin stands at 12.03%, while net profit margin is a modest 5.16%.
- Return on Investment
- Return on assets (ROA): 4.51%
- Return on equity (ROE): 4.61%
- Debt and Liquidity
- A current ratio of 3.61 indicates a strong liquidity position, meaning Littelfuse has more than enough short-term assets to cover its obligations.
Financially speaking, Littelfuse looks stable, though profitability could improve. The company has the resources to continue growing its business while also rewarding shareholders with consistent dividends.
Valuation and Stock Performance
Littelfuse’s stock has been on a downward trend recently, currently trading at $210.40—well below its 52-week high of $275.58.
- Price-to-Earnings (P/E) Ratios
- Trailing P/E: 47.78 (on the high side)
- Forward P/E: 23.15 (more reasonable for future earnings)
- Price-to-Book Ratio
- Currently at 2.20, which is near historical averages.
- Stock Performance Metrics
- Down 9.50% from its 52-week high.
- The 50-day moving average is $235.51, while the 200-day moving average sits at $249.89, reinforcing the recent downtrend.
While the stock’s decline may concern short-term traders, long-term investors who focus on dividends might see this as an opportunity to accumulate shares at a lower valuation.
Risks and Considerations
Every investment comes with risks, and Littelfuse is no exception. Here are a few things to keep in mind:
- Cyclical Business
- The company relies heavily on the industrial and automotive sectors, both of which can be volatile.
- Any downturn in manufacturing or vehicle production could impact revenue and earnings.
- Macroeconomic Pressures
- Rising interest rates could make debt financing more expensive.
- Supply chain disruptions remain a challenge in the electronics and industrial sectors.
- Stock Volatility
- Littelfuse has a beta of 1.26, meaning it tends to be more volatile than the overall market.
- Investors should be prepared for price swings, especially during economic uncertainty.
- Slowing Growth
- Revenue growth was down slightly (-0.8%) year-over-year in the most recent quarter.
- While this isn’t alarming, it’s something to watch, as sustained revenue declines could put pressure on dividend growth.
Final Thoughts
Littelfuse might not be a household name, but it has quietly built a strong track record for delivering reliable dividends and steady growth. The 1.30% yield won’t turn heads, but the company’s commitment to increasing payouts over time makes it an attractive option for long-term investors.
With a solid balance sheet, strong free cash flow, and a manageable payout ratio, Littelfuse offers stability in an often volatile market. While the stock has been under pressure lately, that could present an opportunity for patient investors looking to buy into a high-quality dividend grower at a more reasonable valuation.
For those who value consistency over speculation, Littelfuse is worth keeping on the radar.
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