Littelfuse Earnings: Impressive Profitability to Open a Tough 2023, Shares Ripe for Long-Term Buyers

We maintain our $318 fair value estimate for narrow-moat Littelfuse shares after its first-quarter results and second-quarter guidance exceeded our expectations. Littelfuse’s first half of 2023 looks better than we previously feared, despite pockets of weakness enduring in its consumer-facing, communications, and automotive markets. We now expect more modest softness in 2023, but uncertainty remains in the second half of the year with how customer inventory destocking and demand progress. Even in a mild environment, we remain impressed with Littelfuse’s execution on profitability. Past 2023, we continue to view Littelfuse as a long-term beneficiary of trends toward electrification across its end markets. Shares rose 7% after the print, but we continue to see material upside for investors that buy in at current levels.