Littelfuse Earnings: Soft Demand Continuing Through 2024, but We Believe in a Rebound in 2025

We maintain our $295 fair value estimate for shares of narrow-moat Littelfuse, as our long-term thesis is intact after it reported second-quarter results. Many of Littelfuse's end markets remain weak in 2024, including soft demand in the industrial and commercial transportation end markets. Second-quarter results were better than we expected, but third-quarter guidance missed our model. We expect results through the second half of 2024 to stay depressed, but we continue to forecast a recovery in 2025. In the long term, we see Littelfuse as well-positioned to capitalize on trends toward electrification across its end markets, particularly as applications move to higher voltages. We see shares as lightly undervalued.