Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Vishay Intertechnology Tumbled Today

By Timothy Green - Feb 6, 2018 at 1:43PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The semiconductor manufacturer's results were solid, but they fell short of expectations.

What happened

Shares of Vishay Intertechnology (VSH -1.31%) slumped on Tuesday after the discrete-semiconductor manufacturer reported its fourth-quarter results. Vishay missed analyst estimates across the board, sending the stock 11% lower by 12:20 p.m. EST.

So what

Vishay reported fourth-quarter revenue of $674.5 million, up 18.2% year over year but about $3 million below the average analyst estimate. CEO Gerald Paul pointed to strong demand in nearly all of the company's market segments as the main driver behind the growth. The company's backlog is unusually high as lead times have increased as a result of this demand.

A slumping stock chart.

Image source: Getty Images.

Non-GAAP earnings per share came in at $0.37, up from $0.18 in the prior-year period but $0.02 short of analyst expectations. Vishay posted a GAAP net loss of $1.23 per share due to charges related to the U.S Tax Cuts and Jobs Act.

The company expects to produce between $665 million and $705 million of revenue during the first quarter of 2018, up from $606 million in the prior-year period. This guidance is based on Vishay's capacity constraints.

Now what

Vishay is trying to take advantage of increased demand. Paul laid out the steps the company is taking: "Vishay continues to increase the manufacturing capacities of its key product lines, mainly by pulling forward certain programs of its 5-year Growth Plan. We are excited about the opportunities that accelerated market growth offers Vishay, especially in automotive and industrial applications."

Vishay's fourth quarter was positive on an absolute basis, but investors may be concerned about Vishay's inability to keep up with demand.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Vishay Intertechnology, Inc. Stock Quote
Vishay Intertechnology, Inc.
VSH
$19.52 (-1.31%) $0.26

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
334%
 
S&P 500 Returns
117%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.