Methode Electronics (MEI) AI Stock Analysis

• Market Cap: $282.91M
• Dividend Yield: 5.93%
• Average Volume (3M): 247.15K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.04
• Revenue Growth: -9.51%
• EPS Growth: 29.57%
• Country: US
• Employees: 7,500
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): -0.28
• Shares Outstanding: 35,408,250
• 10 Day Avg. Volume: 226,219
• 30 Day Avg. Volume: 247,147
• PEG Ratio: 0.07
• Price to Book (P/B): 0.32
• Price to Sales (P/S): 0.21
• P/FCF Ratio: -14.64
• Enterprise Value/Market Cap: 1.84
• Enterprise Value/Revenue: 0.53
• Enterprise Value/Gross Profit: 3.42
• Enterprise Value/Ebitda: 18.50
• 1Y Price Target: $9.25
• Price Target Upside: 15.77% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 50 Neutral
• Price Target: $8.00 ▲(0.13% Upside)

Methode Electronics' overall stock score reflects significant financial challenges, particularly in profitability and revenue growth. While there are positive developments in cash flow management and strategic initiatives, these are offset by ongoing issues in the automotive segment and a negative P/E ratio. The high dividend yield and recent executive appointment provide some positive aspects, but the stock remains under pressure due to broader financial and operational challenges.

Positive Factors

Diversified End Markets and OEM Contracts

Serving automotive, industrial, medical and consumer markets with direct OEM relationships creates durable revenue channels. Long-term contracts and multi-industry exposure reduce single-market cyclicality, supporting steadier order books and predictable product development cadence over months.

Improving Free Cash Flow

Material FCF improvement strengthens financial flexibility for debt reduction, capex, or strategic investments. Sustained cash generation helps fund working capital needs across global facilities and supports a path to profitability even if margins and revenue recovery lag in the near term.

Data Center Revenue Growth

A growing data center business provides a structural tailwind outside cyclical auto demand. Data center customers often require recurring supply and vendor-managed inventory, enabling higher revenue visibility, potential scale efficiencies, and diversification of margin mix over multiple quarters.

Negative Factors

Declining Revenue and Negative Margins

Sustained revenue contraction and a negative net margin impair internal reinvestment and long-term competitiveness. Without durable top-line recovery, margin pressure limits R&D and capital allocation, making it harder to rebuild scale and return to consistent operating profitability.

High Automotive Exposure

Nearly half of sales tied to automotive makes the company sensitive to vehicle production cycles and EV-specific content shifts. Structural EV headwinds and regional auto demand volatility can depress volumes and content-per-vehicle, creating multi-quarter risk to revenue and margin recovery.

Moderate Leverage and Negative ROE

A meaningful debt load combined with negative ROE constrains strategic flexibility. Moderate leverage during periods of loss raises refinancing and interest coverage risks and limits the company’s ability to pursue acquisitions or ramp investment without further improving profitability or cash generation.

Methode Electronics Business Overview & Revenue Model

Company Description

Methode Electronics, Inc. designs, engineers, and produces mechatronic products worldwide. It 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 directly or through their tiered suppliers. Its products include integrated center consoles, hidden switches, ergonomic switches, transmission lead-frames, and LED-based lighting and sensors, which incorporate magneto-elastic sensing and other technologies that monitor the operation or status of a component or system. The Industrial segment manufactures lighting solutions; industrial safety radio remote controls; braided flexible cables; current-carrying laminated busbars and devices; custom power-product assemblies, such as PowerRail solution; high-current low-voltage flexible power cabling systems; and powder-coated busbars that are used in various markets and applications comprising aerospace, cloud computing, commercial vehicles, industrial, military, power conversion, and transportation. The Interface segment provides various copper-based transceivers and related accessories for the cloud computing hardware equipment and telecommunications broadband equipment markets; user interface solutions for the appliance, commercial food service, and point-of-sale equipment markets; and fluid-level sensors for the marine/recreational vehicle and sump pump markets. The Medical segment offers Dabir Surfaces, a surface support technology aimed at pressure injury prevention for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. Methode Electronics, Inc. was incorporated in 1946 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Methode Electronics generates revenue primarily through the sale of its electronic components and systems across multiple industry sectors. The company operates on a business model that includes direct sales to original equipment manufacturers (OEMs) and contract manufacturing services, allowing for a steady stream of income from long-term contracts. Key revenue streams include automotive sensors, connectivity products, and medical devices, which are critical for the functionality of modern vehicles and medical equipment. Additionally, Methode benefits from strategic partnerships with major automotive and industrial players, which enhance its market reach and foster innovation in product development. Factors contributing to its earnings include the increasing demand for advanced electronic solutions, ongoing investments in research and development, and the company's ability to adapt to changing market trends and customer needs.

Methode Electronics Financial Statement Overview

Summary

Methode Electronics faces challenges with declining revenue and profitability, as reflected in the income statement. The balance sheet shows moderate leverage and a strong asset base, while cash flow metrics indicate improvements in cash generation. The company needs to address profitability issues to enhance financial performance.

Income Statement

Methode Electronics has experienced declining revenue and profitability. The TTM data shows a negative revenue growth rate of -4.44% and a net profit margin of -5.30%, indicating financial challenges. The gross profit margin has also decreased compared to previous years, reflecting pressure on cost management. However, the company has shown resilience in maintaining a positive EBITDA margin of 1.19% in TTM, despite the negative EBIT margin.

Balance Sheet

The balance sheet reflects moderate financial stability with a debt-to-equity ratio of 0.51 in TTM, which is manageable but has increased over the years. The return on equity is negative, indicating a lack of profitability. However, the equity ratio remains strong, suggesting that the company has a solid asset base relative to its equity.

Cash Flow

Cash flow analysis shows improvement in free cash flow growth, with a significant increase of 123.16% in TTM. The operating cash flow to net income ratio is 0.18, indicating some cash flow generation capability despite net losses. The free cash flow to net income ratio is close to 1, suggesting effective cash management.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.05B	1.11B	1.18B	1.16B	1.09B
Gross Profit	163.40M	178.80M	264.10M	264.90M	274.10M
EBITDA	31.10M	-53.50M	142.30M	174.60M	191.60M
Net Income	-62.60M	-123.30M	77.10M	102.20M	122.30M
Balance Sheet
Total Assets	1.31B	1.40B	1.58B	1.39B	1.47B
Cash, Cash Equivalents and Short-Term Investments	103.60M	161.50M	157.00M	172.00M	233.20M
Total Debt	343.20M	358.20M	335.40M	231.30M	263.70M
Total Liabilities	612.50M	637.50M	626.20M	475.30M	549.00M
Stockholders Equity	693.30M	766.00M	941.80M	913.80M	918.00M
Cash Flow
Free Cash Flow	-15.20M	-2.70M	90.80M	60.80M	154.90M
Operating Cash Flow	26.40M	47.50M	132.80M	98.80M	179.80M
Investing Cash Flow	-32.90M	-17.50M	-153.10M	-37.40M	-24.80M
Financing Cash Flow	-58.90M	-18.90M	3.20M	-114.60M	-142.90M

Methode Electronics Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.99
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MEI, the sentiment is Positive. The current price of 7.99 is above the 20-day moving average (MA) of 7.32, above the 50-day MA of 7.14, and above the 200-day MA of 7.26, indicating a bullish trend. The MACD of 0.27 indicates Negative momentum. The RSI at 64.58 is Neutral, neither overbought nor oversold. The STOCH value of 69.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MEI.

Methode Electronics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CTS	73 Outperform	$1.49B	26.42	10.98%	0.36%	3.70%	1.68%
BHE	72 Outperform	$1.86B	50.65	3.37%	1.44%	-2.93%	-40.33%
VICR	71 Outperform	$7.04B	86.37	13.89%	―	11.55%	1745.46%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ROG	58 Neutral	$1.75B	-26.81	-5.34%	―	-4.87%	-235.48%
PENG	55 Neutral	$1.01B	84,700.18	4.85%	―	10.76%	―
MEI	50 Neutral	$282.91M	-4.51	-8.87%	5.93%	-9.51%	29.57%

Methode Electronics Corporate Events

Methode Electronics Reshapes Executive Benefits and Compensation Plans

On December 16, 2025, Methode Electronics amended the change-in-control agreements for several top executives, including its chief financial officer, head of global automotive, chief procurement and EHS officer, and general counsel, reducing the duration of COBRA continuation coverage in the event of a qualifying change in control from 24 months to 18 months as part of the compensation committee’s annual review of these arrangements. Separately, on December 17, 2025, the board of directors approved the termination of the company’s Deferred Compensation Plan effective December 31, 2025, signaling a tightening and reshaping of executive benefits and post-employment protections that could affect the company’s cost structure and the overall design of its executive compensation program.

The most recent analyst rating on (MEI) stock is a Hold with a $7.00 price target. To see the full list of analyst forecasts on Methode Electronics stock, see the MEI Stock Forecast page.