IEC Electronics Corp. (IEC) research, news, and more from GeoInvesting

Company description

Wed, 30 Dec 2009 05:00:00 GMT

IEC Electronics Corporation provides contract electronic manufacturing services to advanced companies primarily in the military and aerospace, medical, industrial and computing sectors. The company's ultra high reliability capabilities include: design, prototype and volume circuit board assembly, material procurement and control, manufacturing and testing engineering support, systems build, final packaging and distribution.

Research

Thu, 12 Aug 2021 14:37:05 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($10.41, $110.5M market cap), a provider of electronic manufacturing services, announced a merger agreement with Creation Technologies. Creation Technologies will acquire all the outstanding shares of IEC for $15.35 in cash representing a 47% premium over yesterday's closing price.

We added IEC to our Selected Long Disclosure Model Portfolio in November 2019 when the stock was trading at $7.80.

On March 21, 2021 we commenced IEC’s model portfolio ranking at a 2 since the stock experienced a sharp run to $17.98, and given that run, our near-term outlook for strong EPS growth was little weaker than our original sentiment.

On August 3, 2021, during our Member Discussion Live Open Forum, we discussed our increasingly bullish stance on the company after the stock pulled back sharply from its highs. It was our belief that strong EPS growth was back in the cards and adding to our position was not out of the question as IEC looked cheap again.

The acquisition price represents a 96% gain from the time the stock was added to the Selected Long Disclosures.

Research

Wed, 05 May 2021 14:57:18 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($12.10, $127.9M market cap), a provider of electronic manufacturing services announced Q2 2021 results:

Sales of $45.4 million vs $44.2 million in the prior year; below analyst estimates of $49.5
Net loss of $0.03 vs EPS of $0.14 in the prior year; well below analyst estimates of $0.17

“Second fiscal quarter results came in below expectations due to delays in ramping two high value programs. We believe we have built an infrastructure to support the conversion of much higher revenue levels that have now shifted into the second half of the fiscal year...

...With our visibility today, we remain confident and believe we are well-positioned to drive double digit organic growth for the balance of fiscal 2021.”

Research

Wed, 03 Feb 2021 19:29:46 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($16.35, $176.9M market cap), a provider of electronic manufacturing services announced Q1 2021 results:

Sales of $47.5 million vs $44.7 million in the prior year and slightly below analyst of $50.1 million due to reduced staffing issues from Covid.
Non-GAAP EPS of $0.18 vs $0.18 in the prior year period and in-line with analyst estimates

“We delivered a strong start to fiscal 2021, achieving revenue growth, improved gross margin and enhanced profitability. Revenue grew both year over year and sequentially despite employee absenteeism across several of our manufacturing facilities due to COVID-19, largely related to contact tracing precautions rather than positive cases. This resulted in underutilization on the production floor for a portion of the first quarter of fiscal 2021. The post-holiday spike in virus cases appears to be receding, and with workforce attendance returning to normal levels, we expect to see production levels normalize.

As we move through fiscal 2021, we believe IEC is well-positioned to drive continued organic growth, maintain industry-leading margins and deliver enhanced profitability. Our reputation as a consistent and reliable manufacturing partner for high complexity, life-saving and mission critical products continues to gain traction with customers in the marketplace. Likewise, as a 100% U.S.-based manufacturer with a full suite of vertically integrated production services, we believe we have a competitive advantage in attracting partners from a variety of regulated industries who are looking for the highest levels of intellectual property protection and supply chain management. We believe we are competitively positioned to continue to win new customers and programs and look forward to continuing to grow our leadership position as a provider of highly complex manufacturing solutions.”

We give a summary of IEC in our 2020 coverage universe update series which is going to be published later today. As a reminder, last week we removed IEC from our top 5 favorite list and added Information Analysis Inc (OOTC:IAIC). Regarding our actual long position in the stock, since the position size is very small, we will keep it and look to add on pullbacks.

In related news to IAIC, we issued the following tweet this morning that gives a insight into a large investor's holdings of the stock:

Research

Fri, 20 Nov 2020 18:51:27 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($10.05, $106.0M market cap), a provider of electronic manufacturing services announced Q4 2020 results:

Sales of $46.4 million vs $43.9 million in the prior year and slightly below analyst estimates of $47.4 million
EPS of $0.18 vs $0.17 in the prior year and slightly below analyst estimates of $0.19

“Our robust year-end backlog of $194.5 million is derived from a diverse range of customers. Notably, $180.2 million of the backlog is expected to ship within the next twelve months, which represents a year-over-year increase of 19.1% when compared to $151.3 million at the end of fiscal 2019. We are focused on continuing to enhance our offerings to build upon our leadership position as a 100% U.S.-based integrated manufacturing partner. We are pleased with the operational and financial success that we achieved in fiscal 2020, despite the challenges presented by the global pandemic, and we are energized by the opportunities ahead in fiscal 2021 to drive continued growth and profitability.”

We will be on the conference call at 10 AM EST to see if management offers any more color on guidance for 2021.

We want to remind you that an investment in IEC will likely require a longer term focus in that quarterly growth can be lumpy and lead to sharp pullbacks in the stock.

Research

Wed, 05 Aug 2020 17:56:52 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($9.40, $98.5M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors announced Q3 2020 results:

Sales of $47.4 million vs $44.2 million in the prior year and ahead of analyst estimates of $45.2 million
EPS of $0.20 vs $0.11 in the prior year and ahead of analyst estimates of $0.17

“We continue to generate bookings from a diverse base of customers and remain focused on end markets that value our exclusively U.S.-based production model and who recognize the advantages of our vertically integrated manufacturing solutions for mission critical and life-saving products. Our pipeline and backlog remain strong as we continue to have success attracting new business from new customers and in securing new projects from existing customers and we believe this momentum contributes significantly to our ability to consistently deliver strong organic results, that continue to grow at better than industry rates...

...Our focus remains on strengthening our capabilities to meet the high complexity manufacturing needs of our customers as a highly capable and reliable electronic manufacturing solutions provider. We continue to see increased interest from the marketplace and believe we are positioned well to achieve continued organic growth and profitability as we close out fiscal 2020”.

If you want to get caught up on why we think IEC is run by a first class management team with a best-in-class product see our RFT (Reasons for Tracking) article we wrote here. Also please see our virtual presentation from the Investor Summit conference, where Maj pitched IEC.

Research

Wed, 06 May 2020 16:37:16 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($7.27, $75.5M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors announced Q2 2020 results:

Sales of $44.2 million vs $37.3 million in the prior year and ahead of analyst estimates of $43.0 million
EPS of $0.14 vs $0.06 in the prior year and slightly below analyst estimates of $0.14

“Our second quarter results continued the momentum built over the past few quarters. We reported solid revenue growth of 18% compared to last fiscal year’s second quarter and significantly improved profitability…. As our reputation as a premier provider of vertically integrated manufacturing solutions for mission critical and life-saving electronics continues to grow, we are attracting new projects from existing customers, taking market share away from fellow competitors, as well as winning new business awards from new customers….

...Importantly, we have deliberately maintained a 100 percent U.S. manufacturing footprint, which we believe makes us an increasingly attractive supply option for existing and potential customers given current and anticipated future trade complications associated with the COVID-19 pandemic.”

...We continue to strengthen our capabilities to meet the highly complex manufacturing requirements of our customers and our new business pipeline is strong. We remain on track to open our new state-of-the-art facility this summer and believe we are well positioned to increase our market share to drive sustained organic revenue growth and profitability as we move through the back half of fiscal 2020.”

Research

Wed, 05 Feb 2020 05:00:00 GMT

Iec Electronics Corp. (NYSE AMEX:IEC) ($8.19, $85.6m market cap), a company that provides electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products, today announced fiscal 2020 first quarter results.

Revenues of $44.7 million vs. $35.4 million in the prior year, an increase of 26.2%
Adjusted net income of $0.18 per diluted share vs. $0.10 in the prior year, an increase of 80%, and beating analyst estimates of $0.14.

Jeffrey T. Schlarbaum, President and CEO of IEC Electronics commented,

“Fiscal 2020 is off to a strong start. We reported not only substantial revenue growth of 26% over the same quarter last year but also our sixth consecutive quarter of sequential revenue growth. IEC has now consistently achieved revenue in excess of $40 million for the past three quarters, a key revenue milestone we had targeted when we initiated the turnaround of the business.

“During the first quarter we recorded a one-time inventory reserve of $1.0 million due to the reorganization at one of our end customers in the medical sector in late 2019. Our gross margin for the first quarter of fiscal 2020 was 11.7% of sales. Excluding the one-time reserve, our adjusted gross margin would have been 13.9% of sales, consistent with gross margin for fiscal 2019. Please refer to the reconciliation table included in this release for further information regarding this non-GAAP measure. We believe the scale and diversity in the customer base which we have greatly enhanced over the past few years provides a stronger foundation to absorb unforeseen customer events such as this.”

Mr. Schlarbaum concluded, “We entered fiscal 2020 with a robust backlog and our pipeline remains strong. Our new state-of-the-art facility is expected to be opened this year, and with our proven success providing vertically integrated manufacturing solutions for life-saving and mission critical products, we believe we are competitively positioned to win new customers and programs. We look forward to continuing to grow our leadership position as a provider of highly complex manufacturing solutions.”

If you want to get caught up on why we think IEC is run by a first class management team with a best-in-class product see our RFT (Reasons for Tracking) article we wrote here.

We can see the stock approaching 20 to 25 times earnings on 2020 analyst EPS estimates of $0.85. That would equate to a price of $17 to $21 per share.

This is one of the only stocks that we cover with a strong GeoPowerRanking (GPR) of 7. GPR is the number of consecutive quarters of strong growth (YoY) projected by analysts.

Research

Wed, 21 Aug 2019 14:32:07 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($6.55, $69.5M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors, remains in focus as the company’s growth is slated to resume after its upcoming Q4 2019 quarter.

In early May, we closed out our long position in IEC after the company posted sub par Q2 2019 results due to weaker margins caused by tariffs. Management stated that the adverse effect from tariffs would no longer be an issue moving forward, but our calculations for Q3 also forecasted a slight miss on the bottom line based on revenue projections and an expected return to Q1 margins.

Our Q3 2019 EPS forecast was accurate, as the Company posted a slight miss on analyst EPS estimates. However, after reading the Q3 2019 conference call transcript, it seems that the Company may be back on track to resume strong bottom line growth in 2020 due to increased demand.

According to analyst estimates, after IEC reports Q4 2019, it will have a GeoPowerRanking (GPR) of 4. The GPR is the amount of consecutive quarters that a company is expected to experience EPS growth of around 20% to 30%. Below is a snapshot of IEC EPS history and estimates. As you can see, after an estimated 15% bottom line improvement for Q4, EPS growth is expected to significantly improve on a quarter over quarter and year over year basis as it enters fiscal 2020.

Choosing what P/E ratio to apply to 2020 EPS estimates is a little tricky. The industry it operates in is not typically a high P/E industry. However, IEC has typically been trading at a premium valuation. Furthermore, the company is targeting less cyclical markets than it typically has in the past. The good news is that applying a wide range of PE ratio possibilities, from 10 to 25, would insinuate nice upside ($8.80 to $22.00).

As in the past, the ability of the company to manage component shortages will be a major factor in the company's consistent strong growth. Supply shortages can impact their ability to meet demand on a timely basis and reduce gross margins. However, the good news is that this issue is not demand-driven.

Also, although the company is targeting higher growth industries with good long-term demand characteristics, it will still be affected by changes in economic cycles.

Management discusses the component issue in the Q3 2019 conference call:

“Another important element that continues to affect our ability to convert backlog to production is the ongoing global component shortages we've discussed previously. While components used in the consumer sector are seeing recovery with improved availability of parts and shorter lead times, we've continued to see tightness in the supply chain for the highly engineered sole-source components we acquire on behalf of our customer base operating in highly regulated markets. As we work through the ongoing shortages, we become more efficient in managing the associated challenges. We have taken on additional inventory in an effort to mitigate risk. And we will continue to navigate the situation so we'll remain prepared to meet our ongoing customer commitments.”

One of the key factors that attracted us to IEC is the CEO and his ability to run the ship is a first class manager. You can read more about that here.

We are actually scheduled to meet the CEO in late September. Hopefully, we'll be able to have a clearer picture of the supply shortage issue at that time.

Research

Thu, 09 May 2019 15:22:45 GMT

Closed Out Our Long In IEC

In yesterday’s email, we covered Iec Electronics Corp. (AMEX:IEC) Q2 2019 results. The two main causes for the decrease in margins were an increase in tariffs as well as its increase in staff. The company has hired over 100 new employees in 2019 to help execute its future growth plans. However, until the new hires are fully implemented and begin converting orders, they will strain margins. The company does believe that the tariffs will no longer have the adverse effect they had in Q2, as it can be pushed onto customers moving forward. The company expects to return to Q1 margin levels for the second half of the year.

Applying Q1 net margins to the current Q3 analyst estimates of $38.6 million in sales would translate to EPS slightly below the current analyst EPS estimate of $0.13.

While we still believe in the longer term story, late in the trading day yesterday, we issued the following tweet closing out our position.

Research

Wed, 08 May 2019 16:08:58 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($7.07, $72.5M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors, announced Q2 2019 results:

Sales of $37.3 million vs $31.8 million in the prior year and ahead of analyst estimates of $36.8 million
EPS of $0.06 vs $0.15 in the prior year and below analyst estimates of $0.13

“We achieved continued revenue momentum in the second quarter, driven by growth across all three of our market segments. In addition to the year over year improvement, this quarter represents our third consecutive quarter of sequential revenue growth. This growth is purely organic, a result of our success winning new programs from existing and new customers, which we believe demonstrates the value they see in our capabilities and the broad range of solutions we provide as a full service manufacturing partner. For our second fiscal quarter, our book to bill ratio was 1.1:1, and our backlog remains strong.

Second quarter margin performance was at the lower end of our expected range, related primarily to our focus on proactively investing in our workforce and other resource levels to meet the production needs generated by our strong backlog and booking activity. The life-saving, mission critical nature of the programs we support requires that we hire and train skilled staff in advance of converting customer orders from backlog to production. Additionally, our industry continues to contend with component shortages and while we’re becoming more adept at ensuring we have the right materials on hand to meet customer commitments, these shortages impacted production in the quarter and put pressure on our margin performance. Gross margin was also impacted in the second quarter by tariffs on raw materials from China, which affected reconciliation with certain customers between our quoted cost and our actual cost for select programs. We expect the tariff impact in our statement of operations to reverse in the second half of fiscal 2019, and we do not expect any long-term impact to our future performance.”

Outlook:

“Our backlog is up almost 20% since the start of the fiscal year, which reinforces our confidence that we will be able to deliver on our expectation of double digit year over year revenue growth in fiscal 2019. We continue to be energized by the opportunities we are seeing and believe that our technical capabilities, proven dependability as a manufacturing partner and efficient operating model position the Company to deliver consistent levels of organic growth.”

We plan to be on the earnings conference call at 10 a.m. this morning to see if the company addresses the weaker margins in the quarter any further. The one issue that we've had with this company for some time is lumpiness in margins, even as revenue increases.

We thought that the company already had a handle on the component shortage issue. There may be some silver lining to the shortage, as it is a result of high demand. However, we would like management to have better control in the sourcing of components to meet projected high demand and revenue expectations. It's going to be interesting to see if investors put more weight on IEC’s increase in revenue versus its weak short-term earnings per share performance. We still believe that this company has the right CEO in place to drive long-term growth. We’ll likely remove the stock from our disclosed long list and revisit the story unless management makes some clarifying comments on the call. You can see our January 15, 2019 full reasons for tracking article here.

Research

Wed, 06 Feb 2019 16:00:00 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($7.34, $76.1M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors announced Q1 2019 results:

Sales of $35.4 million vs $21.2 million and ahead of analyst estimates of $33.9 million
EPS of $0.10 vs a loss of $0.05 in the prior year and in line with analyst estimates of $0.10

“We’re pleased to have delivered a strong start to fiscal 2019, reflected in significantly increased revenue and enhanced profitability. As we expected, in addition to year over year improvement, we also achieved sequential revenue growth of 4% compared to the fourth quarter of 2018, a notable development as historically our first quarter performance typically shows a sequential decline. This growth is purely organic, driven largely by our ability to win new programs from existing customers, reflecting growing confidence in IEC as a dependable manufacturing partner and the value of our portfolio of vertically integrated offerings. Furthermore, we continued to see strong bookings, achieving an increased book to bill ratio of 1.6:1 at December 28, 2018, up from 1.3:1 at September 30, 2018, resulting in a double digit growth to our overall company backlog...

...As we continue through fiscal 2019, we believe we’re competitively positioned to capture additional market share and grow our leadership position as a reliable and consistent manufacturing partner for life-saving and mission critical products. We are excited by the opportunities we’re seeing in the marketplace and from our vantage point today, we maintain our expectation of delivering double digit year over year growth in fiscal 2019.”

Reasons For Tracking

Wed, 16 Jan 2019 14:22:15 GMT

We believe Iec Electronics Corp. (IEC) is building a leading product offering, led by a proven CEO. We think changes management made since 2015 positions the company to consistently grow revenue, with earnings growing at a faster pace than sales.

Please see our full reasons for the tracking the company here. We are currently long IEC.

Research

Mon, 14 Jan 2019 16:25:57 GMT

Established a sizable short-term position in SMTX and looking to meaningfully increase our IEC position size.

On May 14, 2018 we briefly mentioned 3 EMS stocks made it back on our radar: IEC, KTCC, SMTX. “EMS” stands for Electronic Manufacturing Services.

“Electronic manufacturing services (EMS) are provided by companies that design, assemble, produce, and test electronic components and printed circuit board (PCB) assemblies for original equipment manufacturers (OEMs). EMS companies may provide a variety of manufacturing services, including design, assembly, and testing. EMS companies may be contracted at various points in the manufacturing process. Some companies require only a design file from the customer before proceeding to develop the product, source the components from a trusted distributor, and assemble and test the product.”

We stated in our note:

Generally speaking, these companies only have 1 to 2 quarters of visibility. We have followed all 3 stocks for many years and each has had a hard time with consistent growth. From our past due diligence we noticed they tend to be more mid to late stage economic recovery plays. However, after listening to their respective conference calls, it appears all 3 management teams are forecast bullish revenue trends through the end of 2018. We are placing all 3 stocks on watch

In 2009, we had a good run with MRM, an EMS player that got bought out at a 107% premium to when we disclosed our long position to premium members. Here is a link to our research coverage history.

However, our experiences with other EMS microcap stocks like IEC, KTCC and SMTX were not as favorable, though not disastrous. Our bullish bet on EMS was way too early coming out of the 2008 recession. An archived Premium Email notefrom 2013 stated:

“Positive portfolio returns provided by these companies (IEC, SMX, KTCC) were short lived. Customers of EMS companies can be highly sensitive to economic cycles and can provide an unclear financial visibility during a tenuous economic environment. During such periods, the financial outlook for an EMS company becomes uncertain beyond six months. The fits and starts regarding U.S. growth prospects, combined with uncertainty brought on by the recent fiscal cliff debate, caused many customers of EMS manufacturers to delay order flow. As the economy begins to thaw, EMS stocks may begin to perform favorably again.

On top of that, IEC, KTCC and SMTX had their own problems, ranging from botched acquisitions and poor customer focus to challenges in controlling costs in a low gross margin (sub 10%) environment. Now, with the U.S. economy humming along, it looks like EMS companies are beginning to experience better visibility and a better overall growth outlook.

We have not examined KTCC closely yet, however it looks like IEC and SMTX are setting up for short term moves as we believe the market will start to price in new information that often goes unnoticed in in valuing microcaps.

In the case of Iec Electronics Corp. (NYSEAMEX:IEC) ($6.50, $66.6M market cap), a restructuring that the current CEO, who joined the company in 2015, has put in place may be about to bear fruit. Overall, it looks like IEC has clearly reached a growth inflection point. We have interviewed IEC on multiple occasions and know the story well. We are convinced that the CEO is making all the right moves to position the company for sustained growth. The company’s short term valuation is at the bottom of a range of prices that we think are fair, but we don’t think the market is yet aware of some information arbitrage discussed in its Q4 earnings call that we think could still lead to a short term pop in the stock.

Current estimates indicate nice growth for 2019 and 2020 and by applying a P/E of 10 to 15 on 2019 EPS estimates, the stock is already trading at the low end of a fairly priced range of $6.00 to $9.00. We are preparing a brief RFT on IEC called “IEC Reasons For Tracking - CEO Comes Back To Pick Up Where He Left Off.”

With regards to Smtc Corporation (NASDAQ:SMTX) ($5.07; $117.5M market cap), we are taking a short-term bet based solely on new analyst estimates that take into account a recently transformative acquisition of MC Assembly Holdings. Applying a low P/E of 10 on 2019 EPS estimates of $0.75 implies that shares could soon reach $7.50.

We caution that SMTX has had a history of overpromising and under delivering. We still need to interview management to determine if the company can grow organically (like we believe will be the case with IEC), as opposed to just growing by acquisitions.

In related news, Craig-Hallum just initiated coverage on the name with a “BUY” rating a $9 price target.

Research

Wed, 28 Nov 2018 17:28:59 GMT

Iec Electronics Corp. (NYSEAMEX:IEC) ($5.33, $54.8M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors, announced fourth quarter 2018 results:

Sales of $34.2 million vs $27.6 million in the prior year and slightly below analyst estimates of $34.2 million
Non-GAAP EPS of $0.13 vs $0.07 in the prior year and slightly below analyst estimates of $0.14

"With the close of fiscal 2018, we believe our Company has fully exited the turnaround phase and is well positioned to drive sustained growth. Our strong fourth quarter performance was characterized by increased revenues levels, which have not been seen in 5 years, as well as strong backlog growth. Revenue and volume growth are being driven in large part by our ability to win new projects from existing customers as they recognize IEC's value as a reliable and consistent manufacturing partner and discover the breadth of our diverse, vertically integrated capabilities.

We are energized by the opportunities we're seeing in the marketplace from both new and existing customers. As we move through fiscal 2019, we believe we're well positioned to drive continued growth and to increase our leadership position as a reliable and consistent manufacturing partner for life-saving and mission critical products. Our fiscal fourth quarter backlog increased to $133 million, representing 85% year over year growth, and a level our company has not experienced in more than 20 years. During the fiscal fourth quarter, we also experienced a solid book to bill ratio of 1.3:1. With our visibility today, we expect strong double digit year over year growth in fiscal 2019 and we are eager to start the new year not expecting to experience the seasonal revenue decline from Q4 2018 to Q1 2019 that we have typically experienced in past years."

Management's comments regarding the absence of its typical seasonal decline from Q4 to Q1 indicate a possible nice beat for Q1 2019. Current analyst estimates for Q1 are $28.6 million for revenues and $0.04 in EPS.

You can see our past coverage on IEC here. We been following IEC for several years and it seems that the CEO, Jeffrey Schlarbaum who joined the Company in 2015, is doing a great job of rebuilding the business to recapture some of the market that it used to command. At one point in the company’s history, when he was part of the management team (and not the CEO), this command of the market was more apparent.

Schlarbaum previously left the Company prior to 2015 when he did not agree with the direction it was heading. During that hiatus, the company made several mis-steps. Since rejoining, the Company has seen more consistent growth as it targets less cyclical segments of the industry it serves.

Research

Thu, 02 Aug 2018 04:00:00 GMT

Iec Electronics Corp. (NYSE AMEX:IEC) ($5.25, $53.8M market cap), a provider of electronic manufacturing services (EMS) to a range of technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors, reported its fiscal third quarter earnings this morning:

Sales of $29.8M vs. $26.5M
GAAP EPS of $0.02 vs. $0.08

Management’s commentary:

“We have restored and continue to enhance our reputation as a reliable and consistent manufacturing partner for the life-saving and mission critical products in which we specialize. Furthermore, our backlog has increased more than 70% since the beginning of fiscal 2018 and we remain focused on continuing to expand our new business pipeline with existing and new customers. We believe our targeted go-to-market strategy, improved operations and expertise in our addressable markets position us well to continue to grow our leadership position.”

One of the issues we have had with IEC in the past has been its inability to consistently maintain positive business momentum. However, in this case, this quarter’s underperformance appears to have been impacted by one time temporary issues that will reverse in coming quarters. We still like the new CEO that’s running the ship and we’ll continue to monitor the progress of the company. We may view the weakness in the stock in reaction to the weak quarter as an opportunity to add to our very small position. We plan to follow up with the company to get some insight into the quarter. We have yet to write a detailed article on IEC.

Research

Mon, 11 Jun 2018 14:49:39 GMT

Iec Electronics Corp. (NYSE AMEX:IEC) ($6.23; $63.8M market cap) is a provider of electronic manufacturing services for the medical, industrial, aerospace and defense sectors. IEC is a stock we have monitored for several years. On May 14, 2018 we put 3 electronic manufacturing services stocks on watch.. They were IEC,SMTX,and KTCC.

After sitting down with IEC’s CEO, Jeffrey T. Schlarbaum, I am finally beginning to believe that as long as he stays with the company, it can execute a multi-year growth strategy. Schlarbaum was previously with the company when it was growing and left the company when he disagreed with the vision of the CEO at that time.

He came back to the company in February 2015, and once again has helped the company grow. It now looks as if IEC is reaching an inflection point where it can consistently grow earnings. Visibility in the EMS industry has typically been only a couple of quarters out, but as IEC grows, this could become less of an issue. We are disclosing a small position in IEC.

Comments & Business Outlook

Tue, 31 Jul 2012 04:00:00 GMT

Third Quarter 2012 Results

For the quarter ended June 29, 2012 the Company reported revenue of $36,022,000 compared to $34,626,000 in prior year.
Net income of $2,203,000 or $0.22 per diluted share compared to $0.13 per diluted share for the prior year quarter.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "For the second quarter in a row we have achieved financial results well above our historic metrics, specifically gross margins of 20.6% and operating margin of 9.8%. During the third quarter, cost containment and product mix were important drivers of our higher margins. The gross and operating margin results were some of the best in the company's history, and particularly strong for our industry. We are making solid progress toward our previously discussed 18 month goal of improving our margins to the point where they are consistently above this level.

"I am most proud of IEC's very strong operational results. However, operational strength is only part of our story. The management team has created a solid company by melding together four acquisitions and starting a fifth company. It took us two years to address most of the integration issues. The acquired businesses are growing and are starting to capture synergies among them. All of our businesses are now competing for new business opportunities that were unavailable to us several years ago. They will continue to grow at very respectable rates, broadly speaking between 9 and 14%. Now it is time for us to continue moving forward and take some larger steps growing the company through acquisitions or starting new businesses to better support the markets we serve.

"The quarter was not what we envisioned in either sales growth or debt reduction. We experienced some softness in our industrial and medical sectors, and at the present time those sectors appear to be back on track. With respect to our debt we believe our debt can be reduced to approximately $26 million by the conclusion of our fiscal year at the end of September.

"Our Company continues to move forward as we maintain our long run perspective toward our business. We are confident that we are creating future value for our shareholders and opportunity for our employees."

Deal Flow

Tue, 15 May 2012 04:00:00 GMT

NEWARK, NY--(Marketwire - May 15, 2012) - IEC Electronics Corp. (NYSE Amex: IEC) announced it has reached final agreement with the sellers of Southern California Braiding Inc. (SCB) regarding acquisition-related escrow claims.

When the SCB acquisition was closed in December, 2010, cash and shares of IEC common stock were deposited in escrow with Wells Fargo Bank, N.A. to be released in 2012 to the buyer or sellers dependent upon SCB's achievement of certain post-closing performance metrics during calendar 2011. IEC and the sellers have just concluded an agreement finalizing escrow claims, under which IEC will receive $1.8 million in cash and 68,625 shares of IEC common stock from the escrow. The funds will be applied to IEC debt and the equity will be retired.

W. Barry Gilbert, Chairman and CEO, said, "We were pleased to come to a satisfactory mutual agreement with the sellers of SCB. We will use the funds to continue paying down our debt. As mentioned in our shareholder call on Wednesday of last week, we anticipated paying down our debt by approximately $9 million in fiscal 2012. After the application of these funds, we now envision paying down our debt by approximately $11 million. This is on top of the $12 million we paid down the debt since we purchased SCB last year.

"Although Southern California Braiding has had a challenging start transitioning from a private company to a rapidly growing public company, we believe it will turn out to be one of IEC's best acquisitions. It has started to exhibit the growth we envisioned."

Comments & Business Outlook

Tue, 08 May 2012 04:00:00 GMT

Second Quarter 2012 Results

For the quarter ended March 30, 2012 the Company reported revenue of $38,020,000, this compares to revenue of $35,085,000 in prior year quarter.
Net income of $2,607,000 or $0.26 per diluted share vs net income of $1,747,000 or $0.17 per diluted share for the prior year quarter

W. Barry Gilbert, Chairman of the Board and CEO, stated, "This was an excellent quarter with meaningful improvements across all of our important financial metrics. Most significantly, our gross profit margin reached 21.7 % and operating margin reached 11.8%. These results are some of the best in the company's history, and particularly strong for our industry.

"When we announced our first quarter, we expected our operational cost containment programs to take longer to impact our performance. During the second quarter, these containments certainly supported our results; however it was the shift to higher margin product mix in combination with operational improvement in all segments of the business that produced these historically strong results. All of our businesses operated better than they did last quarter. SCB has improved significantly, has made a positive contribution for the quarter, and we expect their contribution to continue. Some previously delayed programs are starting to be released. Furthermore, SCB has picked up a number of new programs and a significant new customer.

"While our operating income margin saw a sharp increase to 11.8%, we expect operating margins to move closer to 10% over the next 18 months, still well ahead of average operating margin for the last two years of approximately 8.0%. In addition, with cash from improved margins we continue to pay down our debt. At this time, with our current visibility, we expect to reduce our debt by approximately $9 million for the fiscal year ending in September.

"Consistent with past practice, we do not report backlog during the year but we do offer a mid-year update. In that regard, our current backlog is about 10% lower than the backlog figure reported in our 10-K for fiscal 2011. As in the past, it is important to note that some of the backlog extends past 2012 into 2013 and 2014.

"Finally, our sector performance has shifted somewhat, creating a slightly more balanced portfolio. Our military/aerospace sector remains strong, though decreased as a percentage of our sales to 43% for the first six months of fiscal 2012, as compared to 51% of sales at the end of fiscal 2011. This decrease is attributable to the slowdown in military spending; however, we have not had any program cancellations. Our medical and other sector has stayed relatively constant at 25% of sales for the first six months of fiscal 2012 compared to 26% at the close of fiscal 2011. Our industrial and communications sectors improved to 32% of sales for the first six months of this year compared to 23% at the close of fiscal year end 2011.

"Our Company continues to move forward and we are confident that we are creating future value for our shareholders and opportunity for our employees."

GeoBargain Notes

Wed, 01 Feb 2012 05:00:00 GMT

Removing IEC from the GeoBargain List @ $5.11

Added to the GeoBargain list @ $4.98 on 12/30/2009

Catalyst: Strong 4th quarter 2009 and strong multi-year outlook.

Peak performance: Reached a high of $9.88 on 2/11/11, for a possible return of 98%
Current road block: Cautious outlook for 2012. Sees weak global economy and muddled U.S. economy.
Current Price: $5.11

Comments & Business Outlook

Thu, 08 Dec 2011 05:00:00 GMT

Full Year 2011 Results

Revenue of $133.3 million compared to revenue of $96.7 million for fiscal 2010.
Net income after tax was $6.8 million, or $0.68 per share, for year end 2011 compared to net income after tax of $4.7 million or $0.48 per share for fiscal 2010.
For the quarter, the Company reported revenue of $34.9 million and net income of $2.6 million or $0.26 per diluted share. Approximately $1.1 million or $0.11 per share stems from an adjustment related to Southern California Braiding. This compares with revenue of $27.3 million and net income of $1.6 million, or $0.16 per share in the fourth quarter of the prior year.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "2011 was a solid year for IEC as we continue to improve our operating performance and make strong inroads into the Medical sector. Our backlog grew substantially despite continued economic turbulence. The fiscal 2011 closing backlog was over $121.0 million as compared to a fiscal 2010 closing backlog of $91.4 million. $12.7 million of the backlog increase from fiscal 2010 was associated with the SCB acquisition made in December 2010.

"We continue to look for companies that provide a good fit with our strategic vision. Without any acquisitions, our long term annual growth goal is 17%. This year that goal will be difficult to achieve. As mentioned above, we believe we have solid Military and Aerospace platforms. However, the impasse in Congress releasing the funding is uncertain. We expect revenue growth from our existing businesses to be between 9% and 14% for fiscal 2012, and expect both our net income and EBITDA to grow commensurately. The Industrial sector is likely to remain under pressure as long as the broader economy continues to struggle. The pressure is not evenly distributed among the niches we serve, with some of our Industrial customers growing quite rapidly. Our growth in the Medical sector is most encouraging and we believe we can continue to expand our presence in that market."

Mr. Gilbert concluded, "As we have said previously, we firmly believe the Company is continuing to move in the right direction and we are confident that we are creating future value for our customers and shareholders and opportunity for our employees."

Comments & Business Outlook

Thu, 22 Sep 2011 04:00:00 GMT

NEWARK, NY--(Marketwire - Sep 22, 2011) - IEC Electronics Corp. (NYSE Amex: IEC) announces that it has received an order valued at approximately $6.7 million from a Fortune 100 industrial customer. Deliveries are expected to commence either late in the first quarter or early in the second quarter of fiscal 2012.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "We appreciate the continuing confidence of this longstanding customer in our quality standards and on time performance, as demonstrated by their placement of this additional order with us. Despite some negative reports in the press relating to the health of the economy, many of our customers continue to move forward and we're pleased to be part of their ongoing commercial programs."

Comments & Business Outlook

Mon, 08 Aug 2011 04:00:00 GMT

Third Quarter Fiscal 2011 Results

Q3 revenue increased by 32% compared to Q3 2010
Q3 operating profit increased 15.7% compared to Q3 2010
Continued progress integrating Southern California Braiding

For the quarter ended July 1, 2011 the Company reported revenue of $34,626,000 for the quarter, operating income of $2,623,000 (7.6% of sales) and net income of $1,333,000 or $0.13 per share. This compares to revenue of $26,095,000, operating income of $2,268,000 (8.7% of sales) and net income of $1,238,000 or $0.13 per share for the quarter ended June 25, 2010.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for the third quarter of fiscal 2011 was $3,483,000 or $0.35 per share, compared to $2,555,000 or $0.27 per share for the same quarter last year.

IEC reported revenue of $98,355,000, operating income of $7,909,000 and net income of $4,129,000 or $0.42 per share for the first nine months of 2011. This compares to revenue of $69,387,000, operating income of $5,565,000 and net income of $3,027,000 or $0.32 per share for the first nine months of fiscal 2010.

EBITDA for the nine month period ended July 1, 2011 totaled $9,925,000 or $1.00 per share, compared to $6,067,000 or $0.63 per share for the same period last year.

"This was a solid quarter for IEC, but not without its challenges. On the positive side our organic growth was 14% as compared to the same period in fiscal 2010, which is in line with our outlook. Our backlog continues to expand in the face of some weakening broad macro-economic news both domestically and from the Far East. Southern California Braiding recently received a $5 million order from one of its military customers, and we continue to work on a number of exciting new programs, all of which will impact fiscal 2012," said W. Barry Gilbert, Chairman and Chief Executive Officer.

Mr. Gilbert continued, "Nonetheless, the revenue growth and gross margin were somewhat disappointing. Both the growth and the margin were negatively impacted by a delay in $3 million of revenue caused by unplanned downtime in certain equipment, the delay in finalizing the federal military budget, and an unusual number of customer change orders. In addition, we experienced a shift in our product mix. The product mix which was very favorable last quarter was equally unfavorable this quarter and impacted our gross profit.

"The long term view for Southern California Braiding's future is bright. Its current performance, however, has been choppy as we work our way through integration issues such as implementing new systems and expanding communication and business process tools. Nothing we have observed has diminished our enthusiasm about this acquisition, if anything we are more excited. All the programs we were planning have been approved in the defense appropriation budget and we are likely to receive additional awards.

"We strengthened our balance sheet. However, we fell short of our goal of reducing our bank debt. We believe this is a timing issue and remain confident that our bank debt will be reduced on or ahead of our internal schedule.

"We believe that we have met the challenges before us and remain most optimistic about the Company's future prospects. We are continually building a stronger company with immense capability for our customers, our employees and our shareholders."

Comments & Business Outlook

Tue, 03 May 2011 04:00:00 GMT

Second Quarter Results:

For the quarter ended April 1, 2011 the Company reported

revenue of $35,085,000,
operating income of $3,323,000 (9.5% of sales) and
net income of $1,747,000 or $0.17 per share.
This compares to revenue of $25,232,000, operating income of $1,983,000 (7.9% of sales) and net income of $1,036,000 or $0.11 per share for the quarter ended March 26, 2010

W. Barry Gilbert, Chairman of the Board and CEO, stated, "This was another good quarter. All of our important financial metrics improved and we are pleased with our progress. Most significant was the growth of operating income to 9.5% of sales versus 7.9% for the same period last year. The improvement was a combination of various factors; increased efficiency, product mix and the margin generated from our latest acquisition Southern California Braiding (SCB). Just as important, organic sales growth increased by more than 20% over the comparable period.

"We are also pleased with the performance of SCB, whose sales and income were accretive to the Company. It is important to note that during the first year after an acquisition we do not look for any real change in either income or sales from the previous year. Integrating a new company requires significant effort and cost. While SCB will be a good addition for IEC and its integration into IEC Electronics is making reasonable progress, it will take the balance of the fiscal year to complete the effort. SCB's backlog continues to grow and the cross selling opportunities are quickly showing signs of potentially being quite successful. We now expect to be ahead of our forecasted annual revenue of $130 million.

Comments & Business Outlook

Fri, 15 Apr 2011 04:00:00 GMT

NEWARK, NY--(Marketwire - April 15, 2011) - IEC Electronics Corp. announced today that on Tuesday, May 3, 2011 it will release its financial results for the second quarter ended April 1, 2011 and host a conference call to discuss those results with investors.

The Company expects to report revenue of approximately $35 million for the quarter, up 22% from revenue of $28.6 million in the first quarter ended December 31, 2010 and almost 40% from the second quarter of 2010.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "We are pleased with the preliminary results for our second quarter and look forward to sharing our full results with shareholders."

Mr. Gilbert will lead the call and invites all interested parties to join management's discussion of the Company's financial results and other meaningful developments at 10:00am EDT on Tuesday, May 3, 2011

Comments & Business Outlook

Thu, 03 Feb 2011 05:00:00 GMT

IEC Electronics Corp. announced its unaudited results for the first quarter of fiscal 2011 ending December 31, 2010.

The Company reported revenue of $28.7 million for the quarter, operating income of $1,963,000 and net income of $1,049,000 or $0.11 per diluted share. This compares to revenue in the prior year first quarter of $18.1 million, operating income of $1,313,000 and net income of $754,000 or $.08 per diluted share.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "As previously announced, we acquired Southern California Braiding, Inc. ("SCB") on December 17, 2010. Between December 17 and our quarter end, we incurred approximately $70,000 of transitional start-up expenses. The more time we spend with SCB the more excited we become with the prospects for this acquisition and cross selling opportunities. As it was so near the end of the reporting period, the acquisition had almost no impact on our first quarter results. We enjoyed a strong quarter with continued sales, earnings and cash flow growth. During the quarter, we also experienced some challenges introducing a number of new projects while also managing an unusual level of product mix variations, resulting in some temporary inefficiencies amounting to approximately $200,000. With these first quarter inefficiencies behind us we remain confident in our outlook for 2011."

Comments & Business Outlook

Thu, 27 Jan 2011 05:00:00 GMT

Update from November 9, 2010

For the quarter, the Company reported

revenue of $27.3 million compared with revenue of $18.3 million
operating income of $2.1 million compared with operating income of $1.4 million for the same quarter of fiscal 2009.
net income after tax was $1.6 million, or $0.17 per diluted share compared to net income after tax of $0.9 million or $0.09 per diluted share in the prior year period.

W. Barry Gilbert, Chairman of the Board and CEO, stated, “2010 was a strong year for us as we continue to improve our operating performance and make solid inroads into the Medical sector. Our backlog grew substantially despite continued economic turbulence. The fiscal 2010 closing backlog was over $90.0 million as compared to a fiscal 2009 closing backlog of $41.4 million. $20 million of the backlog increase was due to the General Technology and Celmet acquisitions made in December 2009 and July 2010 respectively. More than half of the increase was attributable to organic growth. Our backlog consists of two categories: orders and firm forecasted commitments.”

“Fiscal 2010 saw IEC successfully integrate the acquisitions of General Technology and Celmet,” Gilbert continued. “These two acquisitions have improved the strategic position of the Company by broadening our product offerings and diversifying our customer base. We continue to look for companies that could provide a good fit with our strategic vision. Without any acquisitions, we expect revenue growth from our existing business of approximately 17% for fiscal 2011, and expect both our net income and EBITDA to grow commensurately. We believe our Military and Aerospace sectors will remain strong but anticipate that the Industrial sector is likely to remain under pressure for most of 2011. Finally, we believe we can continue to expand our presence in the Medical sector, which, as mentioned above, grew nicely between 2009 and 2010.

Investor Presentations

Wed, 05 Jan 2011 05:00:00 GMT

We have aggressively added to our IEC position based on information provided in a new investor presentation. Revenue target has been increased to 35% from the original target of 17%.

Deal Flow

Fri, 17 Dec 2010 05:00:00 GMT

NEWARK, NY--(Marketwire - December 17, 2010) - announced the acquisition of Southern California Braiding Company, Inc. (SCB), a privately held company focused on providing high reliability wire and cable products to the military and defense market. SCB is located in Bell Gardens, California.

With annual revenue of approximately $20 million, SCB serves a number of leading customers in the military and defense market. At a purchase price of $25.0 million, the acquisition is expected to be immediately accretive to IEC shareholders. The purchase price has been financed by a credit facility of approximately $24.4 million, provided by Manufacturers and Traders Bank (M&T) and $600,000 in equity.

Conference Call Notes

Wed, 29 Sep 2010 04:00:00 GMT

Conference notes from the Western New York Investors Conference at the Hyatt Regency, Buffalo, New York held on Friday, September 24, 2010.

Industry

100% in U.S.
Niche: Dealing with customers who do not export technology needs overseas. This represents about 20% of a $360.0 billion industry.
Serves the military, aerospace, industrial, medical device and high end communication markets.

Competitive Advantage: Focus is on high reliability, low volume and customers with complex needs.

IEC manufactures complicated assemblies used in many electronic products. Requires specialization and close cooperation. This leads to higher margins and customer loyalty.
Developed proprietary technology employed to test products for failure before delivery.
Also trouble shoots products after delivery in real time through an online system with 2 million lines of code.
Able to serve customers who have choppy demand.
Selects customers carefully. Will make no compromises if a relationship will not make sense. Will not sacrifice margins just to obtain business.

Growth Outlook

All markets are growing solidly.
Customer increasing outsourcing.
Customers winning market share.

Forecast

$150 million in revenues by close of 2012.
Will come from organic growth and acquisitions.
Organic growth is about 17.0%.
Expecting to be many times bigger than they are today.
No intention to go overseas. Many companies coming home.
Prepared for debt to equity to increase to 50%, since cash flow from operations and sufficient tax loss carry forwards can quickly bring this into line.
Equity for acquisitions is not out of the question if will accelerate growth.

Comments & Business Outlook

Tue, 20 Jul 2010 04:00:00 GMT

W. Barry Gilbert, Chairman of the Board and CEO, stated, "This was an especially good quarter. Operating profit of over 8.5% of sales is unique in our industry. Sales growth of more than 50% and operating profit growth of more than 70% as compared to the third quarter of fiscal 2009 were especially gratifying. We continue to execute our growth strategy and enjoy the benefit of a favorable mix of products. Excluding the contribution from our acquisition of GTC, our sales growth from IEC Contract Manufacturing and IEC Wire and Cable was over 15% as compared to the same period of fiscal 2009. We expect to meet our forecasted full-year 2010 revenue of $96 million.

"GTC continues to perform well and its integration with IEC Electronics is moving along nicely. Likewise, GTC's backlog continues to grow as they have acquired a number of new programs from existing customers. As we observed last quarter, unlike IEC Contract Manufacturing and IEC Wire and Cable, whose backlog is shipped during the next four to nine months, GTC's backlog is weighted to 2011 and beyond.

"Consistent with past practice, we do not report our backlog during the year. However, our shareholders should be pleased to know that our current backlog is higher than the backlog reported in our Form 10-K for fiscal 2009.

"Our sector performance remains consistent with previous quarters. The military/aerospace sector remains strong and represents 59% of our sales for the first nine months of fiscal 2010 as compared to 55% of sales at the close of fiscal 2009. Our medical/other sector has increased from 8% of sales at the close of fiscal 2009 to 13% of sales for the first nine months of fiscal 2010. Our industrial sector though growing in absolute terms, declined slightly to 20% of sales for the first nine months of this year as compared to 24% of sales at the close of fiscal year end 2009. The turbulence in the economy impacts the industrial sector more than the others. However, we expect the sector to gain strength over the balance of the year and we envision modest continued improvement in fiscal 2011.

"In summary, our Company continues to move in the right direction and we are confident that we are creating future value for our shareholders and opportunity for our employees."

GeoBargain Notes

Tue, 09 Feb 2010 05:00:00 GMT

GeoNuggets® - Quick Check List Highlighting Undiscovered Opportunities

Company Name IEC Electronics Corp (NYSE Amex:IEC)

Company Description: Provides contract electronic manufacturing services to advanced companies primarily in the military and aerospace, medical, industrial and computing sectors. In addition to procurement and manufacturing activities IEC performs value added service such as initial testing of circuit boards and trouble shooting to ensure that its clients' processes function properly during pre and post market applications.

Data Ended 2/08/2010

Price = $4.70
Trailing EPS = $0.52
Fully-Taxed Trailing EPS = $0.32
Fully-Taxed Implied 2010 EPS based on 2010 Net Income Company Guidance = $0.46
P/E based on Fully-Taxed Trailing EPS = 14.68

Reasons for Optimism

IEC meets 8 out of 10 GeoBargain® Requirements

September Fiscal Year	Requirement	Comments
	Recent 52-week High(generally within 3 months)	Must Reach $7.69
	30% EPS Growth Rate	Full year 2010 net income guidance implies an EPS growth rate of 43.75%
	10% Revenue Growth	Full year 2010 guidance implies a revenue growth rate of 41.57%
	Strong Balance Sheet/Cash Flow	As of 2009 10K
Yes	Current Ratio is at least 2:1	2.5:1
Yes	Debt to Equity Ratio less than 20%	5.7%
Yes	Positive Cash Flow	$ 3.0 Million
	Return on Equity is at least 15%	23.29%
	Minimum Pre-tax Operating Margins of 8%	7.08% Per full year 2010 guidance
	Preferably Under 50 Million Shares	9.55 Million shares as of 2010 10K
	High Insider Ownership (generally greater than 15%)	>15%
	Limited Institutional Ownership (generally less than 20%)	<20%
	P/E Divided by Growth Rate (PEG Ratio) is Less Than 1.	0.35

The January 2010 Investor Presentation contains very bullish commentary:
- The company claims that the "wind is at its back" due to increased outsourcing within select markets and today's elevated trend of customers who will be dependent upon IEC for complex jobs.
- IEC has a solid customer base which includes Gen Electric Co (NYSE:GE), Lockheed Martin Cp (NYSE:LMT), and Goodrich Corporation (NYSE:GR).
- Margins have been on a steady rise since its 2007 4th quarter.
- The company has an acquisition strategy that focuses on new market penetration in high margin sectors.
- By 2012, there is a $150 million revenue goal.
- IEC's strategy is "to cultivate strong manufacturing partnerships with original equipment manufacturers (OEM) in the industrial, communications, medical, homeland security, and military and aerospace industries that require high reliability final assemblies".
IEC recently announced the completion of an acquisition that will add $25 million to revenues and be accretive to earnings per share. It is notable that no stock was issued with this acquisition, a clear sign that management is cognizant of shareholder interest.
The company boasted consistent growth in sales and earnings, even through the global recession.

Full Year 2009 Full Year 2008 Full Year 2007

Revenue $67.8 M $51.1 M $40.9 M

EPS $0.32 $0.11 $0.04
Company guidance implies this growth trend will continue.
- Sales are forecast to increase 41.57% to $96 million
- Pre-tax income is forecast to increase 44.68% to $6.8 million.

Potential Valuation Scenarios if the company can achieve its growth objectives

Short-Term Potential value based on fully taxed adjusted trailing EPS:

P/E 20 * $0.32 = $6.40
P/E 25 * $0.32 = $8.00

Short-term Potential value based on 2009 fully taxed adjusted Implied EPS Guidance:

P/E 15 * $0.46= $6.90

These scenarios are not intended to be investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

Disclosure: Long IEC

Investor Presentations

Wed, 30 Dec 2009 05:00:00 GMT

Investor Presentation filed December 29, 2009.

	Full Year 2009	Full Year 2008	Full Year 2007
Revenue	$67.8 M	$51.1 M	$40.9 M
EPS	$0.32	$0.11	$0.04