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In this updated coverage research report, we reevaluate Littelfuse Incorporated ($LFUS), an information technology sector holding, to determine if it still qualifies for Quality Value Investing’s (QVI) Real-Time Stock Picks based on our proprietary checklist analysis of the company’s current wealth and the stock’s present value.
Littelfuse | Company Current Wealth
Value Proposition
Littelfuse, Inc. (NASDAQ: LFUS) is a small-cap, dividend-paying stock in the electronic components industry within the information technology sector. It was added to the QVI Real-Time Stock Picks on October 19, 2022, at a cost basis of $199.54 per share, adjusted for cash dividends paid.
Company Profile
Littelfuse, Inc. designs, manufactures, and sells electronic components, modules, and subassemblies. Its Electronics segment offers fuses, switches, sensors, and diodes for various industries, including motor drives, automotive, aerospace, data centers, telecom, medical, energy, automation, appliances, and mobile markets. The Transportation segment supplies high-current, high-voltage fuses, battery protectors, switches, relays, circuit breakers, power modules, and sensors for truck, bus, construction, agricultural, RV, marine, and material handling markets. The Industrial segment provides fuses, relays, contactors, transformers, circuit interrupters, arc detectors, switches, and sensors for renewable energy, EV infrastructure, HVAC, safety, construction, MRO, mining, and automation. Products are sold through distributors, direct sales, and representatives. Founded in 1927, Littelfuse is headquartered in Rosemont, Illinois, USA.
Economic Moat
Morningstar assigns Littelfuse a narrow moat rating based on its switching costs, excess returns on invested capital, and sticky customer relationships. Morningstar expects these qualities to likely lead to sustained excess returns on invested capital, which it anticipates will continue, more often than not, for the next 10 years.
QVI’s Value Proposition Elevator Pitch for LFUS
Littelfuse, a nearly century-old electronics manufacturer, consistently earns profits by stocking and reselling products at low prices. Unlike industries such as consumer, energy, materials, and industrials, the technology sector faces less risk of becoming a commodity because it benefits from network effects and switching costs.
QVI’s value proposition rating for Littelfuse: Bullish.
Returns on Management
Revenue Growth and Profit Margins
According to the checklist table below, Littelfuse’s trailing five-year annualized revenue growth was in the upper single digits but underperformed the S&P 500's topline growth of 15.8%. In contrast, the company’s revenue growth of 5.8% lagged behind the broader market’s increase of 18.9% for the most recent twelve months.
Further down the income statement, Littelfuse reported a mid-single-digit net profit margin, achieved through a low gross margin on cost of goods sold, which underperformed the S&P 500’s net profit margin of 23.2% from a gross margin of 54.8%.
Returns on Equity and Invested Capital
Littelfuse’s senior management produced a return on equity (ROE) below QVI’s targeted threshold and the S&P 500’s ROE of 50.1%.
Stock buyback programs often increase ROE. Littelfuse’s latest stock buyback plan, announced in April 2024, authorizes repurchasing $300 million of its common stock through April 30, 2027. As of late October 2025, the company had repurchased about $29 million worth of shares under this program.
Littelfuse’s return on invested capital (ROIC) was below QVI’s threshold and fell short of the broader market’s 27.6% return. Additionally, the company’s ROIC did not exceed its weighted average cost of capital (WACC), suggesting that its senior executives are currently facing difficulties with capital allocations.
Owners’ Earnings
In a further review of management effectiveness, the five-year trailing current wealth of owners’ earnings for Littelfuse, or EPS growth plus dividend rate growth annualized, was in the low single digits, indicating an unacceptable return rate for shareholders from a small-cap technology company. Additionally, the one-year EPS growth was negative at -39.1%.
However, if you replace EPS growth with free cash flow growth in the five-year calculation, the company’s owners’ earnings rise to a respectable 15.17%.
QVI’s business fundamentals rating for Littelfuse:Bearish.
Next, we’ll examine the company’s enterprise downsize risks, the present value of the stock price, share price downside risks, and the investment thesis, each exclusive to Quality Value Investing’s premium (paying) subscribers.
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Unless noted, all data presented is sourced from Charles Schwab & Co., Google Finance, GuruFocus, Littelfuse, Inc., and Yahoo Finance as of the market close on November 12, 2025, and is intended for illustration purposes only.
Disclosure: As of the date of this research report, I/we do not hold any beneficial positions in LFUS common shares in our concentrated family portfolio. I authored this report personally, and it reflects my own opinions. I am not receiving any compensation for it other than from Substack paid subscriptions. I have no business relationship with any company whose stock is discussed in this post.
Additional Disclosure:Quality Value Investing by David J. Waldron’s primary ticker research reports are for informational purposes only. The accuracy of the data cannot be guaranteed. The narrative and analytics are impersonal, meaning they are not tailored to individual needs or intended for portfolio construction beyond The QVI Real-Time Stock Picks, which are provided solely for educational purposes. David is a private investor and author, not an investment adviser. Readers should always conduct independent research or due diligence and consider consulting a fee-only certified financial planner, a licensed discount broker-dealer, a flat-fee registered investment adviser, a certified public accountant, or a specialized attorney before making any investment, income tax, or estate planning decisions.
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