Looking back on electronic components & manufacturing stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including Coherent (NYSE:COHR) and its peers.
The sector could see higher demand as the prevalence of advanced electronics increases in industries such as automotive, healthcare, aerospace, and computing. The high-performance components and contract manufacturing expertise required for autonomous vehicles and cloud computing datacenters, for instance, will benefit companies in the space. However, headwinds include geopolitical risks, particularly U.S.-China trade tensions that could disrupt component sourcing and production as the Trump administration takes an increasingly antagonizing stance on foreign relations. Additionally, stringent environmental regulations on e-waste and emissions could force the industry to pivot in potentially costly ways.
The 10 electronic components & manufacturing stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 3% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 6.9% on average since the latest earnings results.
Coherent (NYSE:COHR)
Created through the 2022 rebranding of II-VI Incorporated, a company with roots dating back to 1971, Coherent (NYSE:COHR) develops and manufactures advanced materials, lasers, and optical components for applications ranging from telecommunications to industrial manufacturing.
Coherent reported revenues of $1.50 billion, up 23.9% year on year. This print exceeded analysts’ expectations by 3.9%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EPS estimates.
Jim Anderson, CEO, said, “We delivered strong growth and profitability in the March quarter with record revenue driven by another quarter of strong AI-related datacenter demand. We also introduced many new industry-leading optical networking products and technologies during the past quarter which position us well for long-term growth.”
Coherent Total Revenue
The stock is up 1.5% since reporting and currently trades at $70.65.
As one of the world's largest printed circuit board manufacturers with facilities spanning North America and Asia, TTM Technologies (NASDAQ:TTMI) manufactures printed circuit boards (PCBs) and radio frequency (RF) components for aerospace, defense, automotive, and telecommunications industries.
TTM Technologies reported revenues of $648.7 million, up 13.8% year on year, outperforming analysts’ expectations by 4.6%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EPS guidance for next quarter estimates.
TTM Technologies Total Revenue
The market seems happy with the results as the stock is up 28.7% since reporting. It currently trades at $25.80.
Operating as a critical behind-the-scenes partner for complex technology products since 1979, Benchmark Electronics (NYSE:BHE) provides advanced manufacturing, engineering, and technology solutions for original equipment manufacturers across aerospace, medical, industrial, and technology sectors.
Benchmark reported revenues of $631.8 million, down 6.5% year on year, falling short of analysts’ expectations by 1.3%. It was a softer quarter as it posted revenue guidance for next quarter missing analysts’ expectations and a slight miss of analysts’ EPS guidance for next quarter estimates.
As expected, the stock is down 9.1% since the results and currently trades at $34.81.
With roots dating back to 1896 and a global manufacturing footprint, CTS (NYSE:CTS) designs and manufactures sensors, connectivity components, and actuators for aerospace, defense, industrial, medical, and transportation markets.
CTS reported revenues of $125.8 million, flat year on year. This number missed analysts’ expectations by 2.3%. Overall, it was a slower quarter as it also recorded a significant miss of analysts’ EPS estimates.
CTS had the weakest performance against analyst estimates among its peers. The stock is flat since reporting and currently trades at $40.02.
With roots dating back to 1946 and a focus on components that must perform flawlessly in critical situations, Knowles (NYSE:KN) designs and manufactures specialized electronic components like high-performance capacitors, microphones, and speakers for medical technology, defense, and industrial applications.
Knowles reported revenues of $132.2 million, down 32.7% year on year. This print topped analysts’ expectations by 2.5%. Overall, it was an exceptional quarter as it also put up revenue guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EPS guidance for next quarter estimates.
Knowles had the slowest revenue growth among its peers. The stock is up 4.5% since reporting and currently trades at $16.37.
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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