Richardson Electronics, Ltd. (RELL) research, news, and more from GeoInvesting

Company description

Mon, 18 Oct 2021 10:48:19 GMT

Richardson Electronics Ltd provides engineered solutions, power grid, and microwave tubes and related consumables, power conversion and RF and microwave components, high-value flat panel detector solutions, replacement parts, tubes, and service training for diagnostic imaging equipment and customized display solutions. Its products have applications in alternative energy, healthcare, aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor markets. It has PMT(Power and Microwave Technologies Group), Canvys, and Healthcare reportable segments. The company derives the majority of its revenues from the PMT segment. Its geographical segments include North America, Asia Pacific, Europe, and Latin America.

Research

Fri, 21 Jul 2023 12:06:04 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($15.55; $190.1M market cap), a company that engages in the power and microwave technologies, announced Q4 2023 results:

Sales of $58.8 million vs $61.6 in the prior year and below analyst estimates of $61.5 million
Non-GAAP EPS of $0.11 vs $0.31 in the prior year and below analyst estimates of $0.19

“As expected, our fourth quarter of fiscal 2023 was challenged by a 20.8% decrease in PMT sales, primarily due to weaker demand from semiconductor wafer fab customers and partially offset by strong GES sales. While we expect the semiconductor wafer fab market to remain challenging over the next several quarters, we remain excited by the significant long-term opportunities we are pursuing across our business units to develop new products and expand our global customer base. This includes power management systems for wind turbines, electric locomotives, hydrogen power, and synthetic diamonds. We believe continued growth from our GES business will help offset the expected fiscal 2024 sales decrease in the semi-conductor wafer fabrication equipment business.”

In late December 2022 we removed RELL from all our Model Portfolio as the stock met our near term targets and recession risk weighed on the company's EMS division.

Now that the stock has had a sharp pullback, we will begin to closely watch it as it appears the company will once again enter a phase of strong growth once it gets past some short term headwinds.

Research

Mon, 10 Apr 2023 17:42:23 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($18.25, $258.0M market cap), a company that engages in the power and microwave technologies, sold off on strong Q3 2023 results. The stock fell 15% on the news. Below are 3 possible reasons, all of which are addressed on the conference call, a call which reinforced some bullish trends for the company:

Backlog was flat year over year for the first time in a long time
Industry wide slowing in the semiconductor wafer fab market
Sequential decrease in GES margin.

We certainly acknowledge there are some near-term headwinds for the company, which is why we removed the stock from our Model Portfolios in December 2022 at $20.35, coupled with tougher financial comps in the short-term:

We will have to see how long these short term headwinds last, but management continues to believe it is just getting started in gearing up for its long-term growth trajectory. The company’s Green Energy Solution business coupled with the electric locomotive arena will provide two new significant revenue generating opportunities. Here is an exchange from the Q&A of the conference call:

Porter Ross Taylor, ARS Investment Partners, LLC - Partner & Portfolio Manager:

“And so -- so what I'm hearing is that you have like $18 million out of 1 particular locomotive. The long haul fleet, obviously, in the U.S. is a huge opportunity, and that can't be -- from my understanding, you cannot have without massive rewiring and shifting of the system. You cannot have many of the alternative technologies that were mentioned a bit ago. But looking at this setup, it does strike me as -- and I'm struggling to get you to kind of say, yes, we have a bunch of things here that in the next couple of years should be as valuable to us as semi-cap equipment is. And right now, you've got a market that's probably trading your stock at 10x what the business ex medical is going to earn this year. So am I wrong when I look at that kind of valuation and math and think that you guys have that huge upside opportunity? No?"

Edward J. Richardson, Richardson Electronics, Ltd. - Chairman, CEO & President

“You're absolutely right. And we're just at the tip of the iceberg. It's -- for instance, in the wind turbines alone, we've only retrofitted about 10% of the 30,000 GE wind turbines that are in the United States and Siemens has 10x that many. So this is -- people ask us, well, what inning are you in? And the answer is, we're just in the batter's box in the first inning. This is just starting, the tremendous opportunity and -- and again, we think the company will be $500 million in 5 years. And you go from -- from $20 million in earnings, $22 million, Bob, this year, yes and just multiply that out going 5 years out.”

We encourage you to also read a new Seeking Alpha article published over the weekend titled, “Richardson Electronics: A Misunderstood Opportunity With Serious Growth Power”

The author does a great job summarizing the story. Below are the bullets from the article:

Richardson Electronics has concrete and in-demand solutions capable of doubling its revenue and maintaining high-profit margins in the next five years.
Q3 2023 indicated impressive YoY growth numbers, especially for its booming Green Energy Solution Business (GES), which saw 103% growth in sales to $11.5 million in Q3 2023.
However, RELL stock has tumbled by 18.55% over the last five days due to flat quarter-on-quarter numbers for the total business backlog, GES sales, and a slowdown of the semiconductor business.
Cautious of the near-term impact of the Chips Act sanctions on its largest revenue-generating customer, LAM Research.

Research

Thu, 06 Apr 2023 17:13:13 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($21.60, $305.4M market cap), a company that engages in the power and microwave technologies, announced Q3 2023 results:

Sales of $70.4 million vs. $55.3 million in the prior year vs. an estimate of 70.2 million
EPS of $0.44 vs $0.21 in the prior year vs. an estimate of $0.38

“We are extremely pleased with the strong financial performance resulting from capitalizing on new market opportunities and continued execution of our key growth initiatives. The third quarter of fiscal 2023 was the tenth consecutive quarter of year-over-year revenue growth and builds on our momentum for another strong financial performance in fiscal 2023. In addition, third quarter operating income increased 110% year-over-year, compared to sales growth of 27% as we benefit from significant operating leverage of fixed expenses,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “Beginning in fiscal 2023, we started reporting a new segment, Green Energy Solutions (“GES”). With the number of opportunities in our pipeline addressing alternative energy, electric vehicles and green manufacturing, we are well positioned for significant long-term growth in this segment.”

We will be on the conference call later this morning (10AM EST) to see if management offers any guidance for Q4 and/or the next fiscal year.

In late December, we removed RELL from all of our model portfolios due to the recession risk and the stock having already met our near-term targets. However, we stated we continue to believe the stock has the makings of a multibagger over the long run.

Research

Thu, 05 Jan 2023 14:38:25 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($20.63, $290.4M market cap), a company that engages in the power and microwave technologies, announced Q2 2023 results:

Sales of $65.9 vs $53.9 in the prior year and above analyst estimates of $64.5 million
EPS of $0.39 vs $0.30 in the prior year and above analyst estimates of $0.29

“We are extremely pleased with the strong financial performance we continue to achieve because of our success capitalizing on new market opportunities, and positive demand trends underway tied to our key growth initiatives. The second quarter of fiscal 2023 was the ninth consecutive quarter of quarter of year-over-year revenue growth and positions us for another strong year of operating and financial performance for fiscal 2023,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “In the first quarter of fiscal 2023, we began reporting a new segment, Green Energy Solutions (“GES”). With rapidly increasing sales from green energy products and customers and over $192 million in total Company backlog, we believe sales and profits will continue to significantly increase in fiscal 2023.”

In late December, we removed RELL from all our model portfolios due to the recession risk and the stock having already met our near term targets. However, we stated we continue to believe the stock has the makings of a multibagger over the long run. This was another strong quarter for the company despite financial results being down slightly sequentially.

Research

Thu, 29 Dec 2022 15:53:20 GMT

Removing RELL From All Model Portfolios

On December 23, 2022 we removed Richardson Electronics, Ltd. (NASDAQ:RELL) ($20.35, $282.8M market cap), from our Top 5 Favorites Model Portfolio. We are now removing the stock from all of our model portfolios.

As we mentioned in our prior note, we do feel the stock has the makings of a multibagger over the long run. However,given the recession risk and the stock having already met our near term targets, we decided that this decision was prudent.

See our recent note on reasons we are removing RELL here.

Research

Fri, 23 Dec 2022 05:00:00 GMT

**Call To Action

Removing RELL From Top 5 Favorite Model Portfolio

Richardson Electronics, Ltd. (NASDAQ:RELL) ($21.62, $300.5M market cap), a company that engages in the power and microwave technologies. had a strong run in 2022. However, as we alluded to in this month's live forum, we are removing it from the Top 5 Favorites Model Portfolio, even though we think the stock can be a multibagger over the long run.

We believe the company's near-term fair value falls between $19 and $31, using a trailing 12 month price to earnings multiple range of 15x to 25x, which we think will default to the higher end.

Part of our motivation to make this move is that the company does have some exposure to the semiconductor industry, which could be affected by a recession.

Furthermore, the market has been very volatile and we’ve seen many great performing stocks give up all their gains pretty quickly. So, there is possibly a chance we will have an opportunity to re-engage with the stock at a lower price,

Now, to be clear, we don’t want to base our decisions on economic forecasts or market sentiment. However, we think our decision is prudent, given RELL's performance, as its overachievement came at a time when this kind of move has been rare across all market cap ranges.

We added the stock to our Faves on February 3, 2022 when it was trading at $12.26. Shares reached a recent high of $27.24 or, 122%. It currently sits at 76% higher.

For more color on the RELL story, see our past coverage:

Reasons for Tracking note.
Fireside Chat with CEO.
Brief clip of recent site visit by Maj.

–

Research

Wed, 05 Oct 2022 04:00:00 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($15.34, $212.7M market cap), a company that engages in the power and microwave technologies, announced Q1 2023 results and increased backlog.

Q1 2023 sales of $67.6 million vs $53.7 million in the prior year and ahead of analyst estimates of $62.4 million
EPS of $0.45 vs $0.20 in the prior year and well ahead of analyst estimates of $0.24

“We are extremely pleased with the strong financial performance. The first quarter of fiscal 2023 was our ninth consecutive quarter of sequential revenue growth and is a great start to our new fiscal year. Investments in our growth initiatives continue to pay off as we focus on pursuing exciting market opportunities that we believe will drive long-term growth,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “Beginning with the first quarter of fiscal 2023, we are reporting a new segment, Green Energy Solutions (“GES”), reflecting the success of our growth strategies and our ability to provide engineered solutions for new markets. With increasing sales from green energy products and customers and over $199 million in total Company backlog, we believe sales and profits will continue to significantly increase in fiscal 2023.”

We will be on the conference call this morning at 10 AM EST to see if management offers any more details on guidance/outlook as we move through fiscal 2023. With trailing non-GAAP EPS of $1.27, the stock is trading at a meager P/E of 12.0 on trailing earrings.

Research

Fri, 22 Jul 2022 12:26:35 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($16.9, $230.8M market cap), a company that engages in the power and microwave technologies, announced Q4 2022 results and increased backlog.

Q4 2022 sales $61.6 million vs $50.5 million in the prior year
EPS of $0.31 vs $0.13 in the prior year
Backlog increased to $206.2 million in the fourth quarter versus $175.6 million at the end of the third quarter and $110.0 million at the end of the fourth quarter of last fiscal year.

“The positive momentum we have been experiencing is a result of the strategies we are pursuing to develop new products and applications for large and emerging global markets. The fourth quarter of fiscal 2022 was our eighth consecutive quarter of sequential revenue growth, driving the highest level of annual revenue since the sale of RFPD in 2011,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “Despite an increasingly challenging and uncertain global economic environment, we believe we are well positioned for long-term, profitable growth. In addition, we are starting fiscal 2023 from a position of strength with over $206 million in backlog and increasing sales from new manufactured products and new customers. As a result, we believe sales and profits will continue to increase in fiscal 2023.”

Shares hit a new high of $17.21 in yesterday’s trading session. Recall that the company had preannounced its revenue and backlog figures last month. Shares could pull back since the company preannounced sales for the quarter.

Furthermore, the one analyst who covers the stock raised his sales and EPS forecast (substantially) for the quarter, which subsequently led to a slight miss on EPS. Not all of the sources we follow posted estimates, but we saw estimates of $61.5 million for revenue and $0.35 EPS (previous estimate was around $0.25). Regardless, we feel this was a very strong quarter for the company.

Shares are up 17% from our January 2022 long disclosure and currently trading at a Trailing P/E ratio of 15.

The company will be hosting a conference call at 10AM EST which we plan to be on to see if any information arbitrage or more specific guidance is presented.

Research

Tue, 07 Jun 2022 13:48:59 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($14.38, $196.4M market cap), a company that engages in the power and microwave technologies, announced preliminary Q4 2022 results and increased backlog.

Q4 2022 sales estimated to be between $60.5 and $62.5 million representing 20 to 24% growth over the prior year period and ahead of analyst estimates of $55.5 million
For full year 2022, sales are estimated to be in the range of $222.0 and $226.0 million representing 25 to 28% growth over 2021 and ahead of analyst estimates of $218.4 million
Backlog increased to $206.2 million from $175.6 million at the end of Q3 and from $110 million in the prior year Q4.

“Sales increased across the Company’s three business units for both the fourth quarter and fiscal year from the same periods a year ago due to strong end-market demand and successful new product expansion initiatives…

…We are extremely pleased with the Company’s performance in the fourth quarter. In fact, we have now had eight consecutive quarters of sequential sales growth with higher backlog demonstrating strong momentum as we head into fiscal year 2023,” said Edward J. Richardson, Richardson Electronics’ Chief Executive Officer. “During the fourth quarter, we continued fulfilling orders for our patented ULTRA3000® Pitch Energy Module (PEM), an ultracapacitor-based plug and play replacement for batteries within GE wind turbine pitch systems. Sales to our semiconductor wafer fabrication equipment customers and demand for our power grid and microwave tubes also remained strong. In addition, Canvys, our custom display business, had record quarterly sales during the fourth quarter. We look forward to sharing our full financial results and providing an update on our outlook for fiscal year 2023 when we release fourth quarter and full year results on July 20, 2022.”

We are happy to see that shares are starting to perform nicely, nearly back to its January highs in the upper $15 range as of pre-market trading today, and in this tough market environment

For more color on the RELL story see our recent coverage:

Reasons for Tracking note
Fireside chat with CEO
Brief clip of recent site visit Maj attended

Interviews

Wed, 13 Apr 2022 14:46:58 GMT

4/12/2022 Richardson Electronics (RELL) Management Morning Briefing

Research

Thu, 07 Apr 2022 04:00:00 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($12.44, $168.2M market cap.) is a company that engages in the power and microwave technologies, announced Q3 2021 results:

Sales of $55.3 million vs $45.2 million in the prior year
EPS of $0.21 vs $0.02
Backlog increased to $175.6 million in the third quarter versus $146.9 million at the end of the second quarter and $98.7 million at the end of the third quarter of last fiscal year.

“In our third quarter of fiscal 2022, we produced our seventh consecutive quarter of sequential revenue growth,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “With continued growth in our backlog in all three business units, and new customers expressing interest in our growing range of engineered solutions, we remain confident that in spite of the challenging economic environment, fiscal year 2022 will finish with strong sales and improved profitability.”

The company posted another strong quarter. While EPS was down some from Q2 due to slightly lower gross margins, the strong year over year growth continued and backlog seems to be accelerating. We are looking forward to the conference call this morning at 10 AM EST. In the Q2 call, management offered some very bullish comments on all its business segments and the visibility about future growth. We would like to see a reiteration of those messages in this call.

For more color on the RELL story see our recent coverage:

Reasons for Tracking note
Fireside chat with CEO
Brief clip of recent site visit Maj attended

Interviews

Tue, 29 Mar 2022 13:44:54 GMT

3/28/2022 Richardson Electronics, Ltd. (RELL) Site Visit - Ultra Capacitor Back Up Power Application - Wind Turbines [3/28/2022 RELL Site Visit]

Interviews

Sun, 27 Feb 2022 05:00:00 GMT

We’d like to point you to a few clips from our discussion with Richardson Electronics, Ltd. (NASDAQ:RELL) CEO Edward Richardson on February 23 , 2022. RELL is an industry-leading global provider of engineered solutions, RF & microwave, and power products. For a refresher on why we started to track RELL, please read our RFT here, published January 7, 2022.

While we had already alerted you to the Fireside Chat replay, picking out useful segments of conversation like the ones below is something we’d like to do on a regular basis.

It’s our opinion that the company is capitalizing on a rare opportunity to create a moat in several of its business segments to enable it to log above average growth rates in sales and EPS for the next several years. We think this will result in an expansion of the stock’s valuation multiples and put the stock on track to be a multi-year multibagger.

Below are highlights of subject matter related to the company’s tube/magnetron/microwave business and use cases, the replacement of lead acid batteries with longer-life ultracapacitor modules in wind turbines, as well as the profitability of these capacitors.

We are extremely excited about the company’s involvement in the wind turbine industry, as its ultracapacitor solutions extend the useful life of equipment needed to operate turbines when compared to the status quo lead acid lead acid battery solution. Furthermore, the company is starting to address the needs of lab grown diamond and 5G markets, hot and growing sectors where RELL is seeing increased order flow.

On turbines, Richardson explains that RELL is:

“…concentrating on the [turbines] US market, but the ultimate market for these products is absolutely amazing. And so far, we’ve only spent about $2 million on this. Not even that, maybe more like a million dollars on this product, a half a million dollars on pick and place equipment, and a half a million dollars on R&D and engineering. And you can look at it. The first order was $10 million at 35%. So the return on investment is incredible.”

Edward also talks about how much more convenient the ultracapacitor is than lead acid batteries, from maintenance, longevity and environmental impact perspectives. He goes on,

“The ultracapacitor module has a life of about 10 to 15 years, and the lead acid battery lasts two years. And they fit in the cone of the wind turbine 300 feet off the ground. So every time one fails, that technician has to go up that turbine, not only the downtime for the turbine being down but the cost to maintain it. So all of these wind turbine operators are extremely excited about retrofitting this equipment that will make it practically maintenance free going forward.”

Edward continues to explain how his patents are basically going to help them come out on top within the addressable wind turbine industry, where orders from some of the major industry players will play a key role for the company’s consistent and accelerated growth.

“And we now have multiple patents on that device which cover 20 or more different functions within the unit. And NextEra placed their first order witness about a year ago for $10 million. And we’re just delivering on that order. We delivered about $3 million and NextEra just in the last few days told us they run about 10,000 wind turbines in the United States, and they’re adding 1000 each year. And their intent is to retrofit 1000 of those wind turbines each year, until they’re completely out of lead acid batteries. So the first order was $10 million, they’re telling us the second order will be coming for $10 million. And as long as we do our job right, and the product works correctly, there’ll be replacing $10 million a year.”

Finally, the clip below features Edward talking about how RELL’s tube/magnetron/microwave business is used in various applications, including the manufacturing of synthetic diamonds, the conversion of acetylene to hydrogen, the removal of carbon from rubber tires to make tiles, weather radar systems, and metal forming and semiconductor related applications. Combined, these contribute $100 million in revenue ro RELL’s top line, says Richardson.

Thanks for Watching.

Interviews

Thu, 24 Feb 2022 05:00:00 GMT

2/23/2022 Fireside Chat with Andrew Richardson President and CEO, Richardson Electronics, Ltd. (RELL)

Research

Thu, 03 Feb 2022 18:09:34 GMT

In yesterday’s Live Open Forum, a replay of which will be published today, we discussed the removal of Muscle Pharm Corp (NASDAQ:MSLP) from our Top 5 Favorites Model Portfolio and added Richardson Electronics, Ltd. (NASDAQ:RELL) in its place.

While MSLP continues to be a turnaround story and remains in our Select Long Disclosures Model Portfolio, we feel RELL is more timely and has the potential for strong top and bottom line growth for several years to come. Please see our recent Reasons for Tracking commentary for more color on the RELL story. MSLP announced distribution with AMZN which could accelerate the turnaround, see more below.

Reasons For Tracking

Fri, 07 Jan 2022 14:56:16 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($14.36, $191.5M market cap.) is a company that engages in the power and microwave technologies, customized display solutions, and healthcare businesses. Recall, in yesterday’s email we discussed the company’s strong Q2 2022 results and that the company was our first selection in GeoInvesting’s new “FundiTrading” Model Portfolio in mid-October 2021.

The FundiTrading portfolio is intended to include stocks that we feel will enjoy near term upside movement based on expectations that they will report strong sales and EPS for several consecutive quarters. These selections are usually not based on deep-dive due diligence on our part, but are intended to bring you momentum ideas more quickly.

However, in the case of RELL, we are beginning to think of the company as a higher conviction selection based on our interaction with the CEO at the 2021 LD Micro Cap Conference and the company’s strong Q2 2022 numbers. We also saw some information arbitrage on the related conference call.

Even though the stock has risen 20% since the inclusion in our model portfolio, we think shares should actually be valued between $18 and $20 based on trailing numbers, as well as our earnings expectations over the next few quarters. We do see a path to $30 over the year or so due to management’s portrayal of strong visibility and yoy growth for several years to come.

We are trying to schedule an interview with management for next week.

Our initial reasons why we like the company include:

Meets 9 of our 10 tier one quality microcap criteria listed here (the one criterion not met is high insider ownership, which only stands at 10%)
Servicing growing hot sectors - Healthcare, renewable energy, electric vehicles
Management is executing a turnaround that is easy to understand and has characteristics of past multi-baggers we’ve invested in:
- Entering higher margin markets
- Developing higher margin products
- Entering more predictable segments of their industry which will increase visibility and reduce volatility in quarterly results
- Gaining more wallet share from its current customer base
- Finding new markets for proven legacy product lines
- Six consecutive quarters of growth on a sequential basis and 5 consecutive quarters of year over year growth

Reported highest quarterly profit in 11 years, with 5 straight profitable quarters of growth year over year

*$0.30 Q2 2022 not reflected in table

Based on our initial due diligence, we believe the company can report several more quarters of strong top and bottom line growth
Experiencing operating leverage, meaning future revenues will increasingly trickle down to EPS
Q2 Conference Call Information Arbitrage:
- Backlog is at record levels and growing. Management also stated the backlog could double in 2022.
- Management guidance implies strong Q3 and Q4 numbers; Provided full year sales guidance of $215 to $220 million.
- 20% growth for several years to come.
- Expects to announce a new partnership in the wind power segment.
- Management expounds on operating leverage - “About $160 million, we weren’t profitable. $177 million, you can see what happened last year. And at $215 million, it really starts to add. And so what happens is, because we don't have to add infrastructure, a large percentage of that falls to the bottom line.”

We look forward to our call with management to learn more about what kind of problems the company's products are solving. We are moving the stock from our short term FundiTrading model portfolio to our Select Long Disclosure Portfolio as we start to consider the Company as a longer term investment opportunity.

Research

Thu, 06 Jan 2022 18:30:24 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($12.64, $181.8M market cap.), a company that engages in the power and microwave technologies, customized display solutions, and healthcare businesses, announced Q2 0222 results:

Sales of $54.0 million vs $42.4 million in the prior year
EPS of $0.30 vs $0.05 in the prior year

“Our strong second quarter financial and operating performance is encouraging, as we produced our sixth consecutive quarter of increased revenues and our highest quarterly operating profit in 11 years,” said Edward J. Richardson, Chairman, Chief Executive Officer, and President. “Our second quarter results reflect the success of our multiple growth strategies as well as strong performance of new products, including our new ULTRA3000. In addition, we are experiencing favorable demand trends across many of our global markets. I am also pleased by the significant improvement in profitability, which we believe demonstrates the power of our compelling financial model. With continued growth in our backlog, we remain confident that fiscal year 2022 will be a strong year of sales growth and improved profitability.”

Recall the company issued preliminary Q2 2022 revenues in early December 2021, but did not provide the strong EPS it just reported. We will be on the conference call this morning at 10AM Eastern to see if management conveys anything that would translate to information arbitrage opportunities.

RELL was the first selection in our new “FundiTrading” model portfolio in mid-October. Maj briefly discusses FundiTrading in our October open forum (51:24).

He also discussed the concept of the Portfolio in this PodClip.and why RELL was the first stock to be included in it.

Research

Wed, 08 Dec 2021 19:01:58 GMT

Richardson Electronics, Ltd. (NASDAQ:RELL) ($11.17; $148.9 M market cap), a company that engages in the power and microwave technologies, customized display solutions, and healthcare businesses, announced preliminary Q2 2022 revenue guidance of $54 million, representing a 27% increase over the prior year. Backlog also increased from $126.5 million at the end of Q1 to $146.9 million in Q2.

“The strong start to fiscal 2022 is encouraging. In fact, we have experienced six consecutive quarters of sequential revenue growth demonstrating strengthening demand trends across most of our global markets, and the benefits of our growth initiatives,” said Edward J. Richardson, Richardson Electronics’ Chief Executive Officer. “During the second quarter, we began shipping our patented ULTRA3000® Pitch Energy Module (PEM), an ultracapacitor-based plug and play replacement for batteries within GE wind turbine pitch systems. Sales to our semiconductor wafer fabrication equipment customers and demand for our power grid and microwave tubes were also strong. In addition, Canvys had record quarterly sales during the fiscal 2022 second quarter and Richardson Healthcare sold more ALTA750 tubes than any prior quarter. We look forward to sharing our full financial results and providing an update on our outlook when we release second quarter results on January 5, 2022.”

RELL was the first selection in our new “FundiTrading” model portfolio in mid-October. Maj briefly discusses FundiTrading in our October open forum (51:24).

PodClips

Thu, 14 Oct 2021 04:00:00 GMT

Maj explains why RELL is part of a new Model Portfolio coined "Fundi Trading"

Comments & Business Outlook

Thu, 07 Oct 2010 04:00:00 GMT

FINANCIAL SUMMARY ─ THREE MONTHS ENDED AUGUST 28, 2010

Net sales for the first quarter of fiscal 2011 were $137.1 million, up 25.3%, compared to net sales of $109.5 million during the first quarter of last year.

Gross margin as a percentage of net sales decreased to 23.8% during the first quarter of fiscal 2011 compared to 24.2% during the first quarter of last year.

SG&A expenses during the first quarter of Fiscal 2011 were $23.3 million, or 17.0% of net sales, compared to $22.9 million, or 21.0% of net sales, during the first quarter of last year.

Operating income during the first quarter of fiscal 2011 was $9.3 million, or 6.8% of net sales, compared to $3.5 million, or 3.2% of net sales, for the first quarter last year.

Net income during the first quarter of fiscal 2011 was $8.4 million, or $0.47 per diluted common share, compared to net income of $1.9 million, or $0.11 per diluted common share, during the first quarter of last year.

OUTLOOK

On October 1, 2010, the Company announced the signing of a definitive agreement to sell its RF, Wireless and Power Division (“RFPD”) and certain other assets to Arrow Electronics, Inc. (NYSE: ARW) for $210 million in cash, subject to post-closing adjustments.

The transaction is subject to the approval of shareholders of Richardson Electronics, Ltd. as well as customary closing conditions and regulatory approvals. The companies expect the transaction to close in early January 2011.

“We continue to see growing demand in our business despite concern over the sustainability of the recovery. During the second quarter, RFPD will be reflected as a discontinued operation. As a result, we expect that sales for EDG and Canvys for the second quarter to be in the range of $35 to $40 million, representing more than 10 percent growth over prior year,” said Mr. Richardson.