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Vishay (VSH) Q2 Earnings & Revenues Beat Estimates, Rise Y/Y

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Vishay Intertechnology, Inc. (VSH - Free Report) reported second-quarter 2022 adjusted earnings of 82 cents per share, which surpassed the Zacks Consensus Estimate by 26.2% and rose 34.4% year over year.

Revenues of $863.5 million increased 5.4% year over year. The figure surpassed the Zacks Consensus Estimate of $856.9 million.

The strong performance of resistor, inductor, diode, capacitor and opto product lines drove year-over-year revenue growth in the reported quarter.

However, the extended impacts of the pandemic-induced shutdown of the company’s facilities in China in the second quarter remained concerning.

Vishay’s book-to-bill ratio was 1.07 at the end of the second quarter.

Vishay Intertechnology, Inc. Price, Consensus and EPS Surprise

 

Vishay Intertechnology, Inc. Price, Consensus and EPS Surprise

Vishay Intertechnology, Inc. price-consensus-eps-surprise-chart | Vishay Intertechnology, Inc. Quote

Product Segments in Detail

Resistors: The segment generated revenues of $230 million (25% of the total revenues), up 16% year over year. The strong momentum of resistors across automotive, industrial, military and medical markets was a positive. The book-to-bill ratio for the product line was 1.05 in the reported quarter.

Inductors: The product line generated revenues of $90 million (10% of the total revenues), which increased 7% on a year-over-year basis. This was primarily attributed to the company’s well-performing magnetics, which continued to drive its specialty business. The book-to-bill ratio for the product line was 0.97 at the end of the reported quarter.

MOSFET: The product line generated revenues of $158 million (18% of the total revenues), decreasing 4% year over year. This was due to the pandemic-induced plant and warehouse shutdowns in Shanghai. The book-to-bill ratio for the product line was 1.14 at the end of the reported quarter.

Capacitors: The product line generated revenues of $132 million (15% of the total revenues), up 7% year over year. The book-to-bill ratio for the product line was 1.17 in the reported quarter. Growing opportunities for capacitors in the areas of power transmission and electro cars remain tailwinds.

Diodes: The segment generated revenues of $192 million (22% of the total revenues), up 14% from the year-ago quarter. Vishay’s strong momentum across the automotive and industrial markets with diodes remained a positive. The book-to-bill ratio for the product line was 1.10 in the quarter under review.

Optoelectronics: The product line generated revenues of $78 million (10% of the total revenues) in the reported quarter. The figure was up 9% from the year-ago quarter, owing to a strong demand environment. The book-to-bill ratio for the product line was 0.86 for the period.

Operating Details

In second-quarter 2022, the gross margin was 30.3%, expanding 230 basis points (bps) on a year-over-year basis.

Selling, general and administrative expenses were $110.4 million, increasing 6.3% year over year. As a percentage of the total revenues, the figure expanded 10 bps from the year-ago quarter to 12.8%.

The operating margin expanded 220 bps on a year-over-year basis to 17.5%.

Balance Sheet & Cash Flows

As of Jul 2, 2022, cash and cash equivalents were $765.6 million, down from $789.2 million as of Mar 31, 2022. Short-term investments were $81.1 million, down from $96.6 million in the previous quarter. Inventories were $633.8 million, up from $602.9 million in the prior quarter.

Long-term debt was $463.3 million at the end of the second quarter compared with $456.5 million at the end of the first quarter.

In the reported quarter, Vishay generated $74.7 million of cash from operations, up from $33.6 million in the previous quarter.

The company’s free cash flow in the second quarter was $15.2 million.

Vishay returned $40.6 million to stockholders, of which $14.3 million was paid out as dividends and $26.3 million was for stock repurchases.

Guidance

For third-quarter 2022, Vishay expects total revenues of $860-$900 million. The Zacks Consensus Estimate for the same is pegged at $862.2 million.

The company anticipates a third-quarter gross margin of 29% (+/-50 bps).

Zacks Rank & Stocks to Consider

Vishay currently has a Zacks Rank #3 (Hold).

Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like MACOM Technology Solutions (MTSI - Free Report) , Keysight Technologies (KEYS - Free Report) and Asure Software (ASUR - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

MACOM has lost 26% in the year-to-date period. The long-term earnings growth rate for MTSI is currently projected at 16.2%.

Keysight Technologies has lost 20.9% in the year-to-date period. KEYS’ long-term earnings growth rate is currently projected at 9.1%.

Asure Software has lost 29.6% in the year-to-date period. The long-term earnings growth rate for ASUR is currently projected at 14%.