Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - B.Riley downgraded Universal Electronics (NASDAQ:UEIC) from Buy to Neutral and slashed its price target to $5.00 from $14.00 on Monday. The stock, which has declined over 54% year-to-date and trades at just 0.44 times book value, appears undervalued according to InvestingPro analysis.
The downgrade follows the company’s second-half guidance, which reflects "considerable deterioration" in its business outlook despite earlier signs that the secular decline in legacy home entertainment products was moderating.
B.Riley no longer expects growth for fiscal year 2025, even though Universal Electronics is gaining market share with higher average selling price HVAC and HASH products.
The research firm described the outlook beyond FY25 as "seemingly choppy at best," prompting the significant reduction in price target and rating change.
B.Riley noted some positive developments, including Universal Electronics achieving positive net cash for the first time since December 2021 and a favorable ruling to consolidate actions in its litigation against Roku (NASDAQ:ROKU), with a judge meeting scheduled for late September 2025.
In other recent news, Universal Electronics reported its financial results for the second quarter of 2025, exceeding earnings expectations. The company achieved an earnings per share (EPS) of $0.18, surpassing the forecasted $0.08, which represents a 125% surprise. Revenue for the quarter was $97.7 million, slightly above the anticipated $95.13 million. In a separate development, Rosenblatt Securities downgraded Universal Electronics from Buy to Neutral, setting a price target of $8.00. The downgrade was attributed to concerns regarding the company’s revenue growth trajectory. Rosenblatt noted that while the Home Control Business is expanding, its growth is inconsistent and not enough to counterbalance challenges in other areas. These developments highlight the mixed performance and outlook for Universal Electronics.
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