DLB: 3 Consumer Electronics Brands Gaining Market Share

Consumer electronics brands are experiencing a reshuffling in market leadership driven by innovation, pricing strategies, and changing consumer preferences. Also, the consumer electronics industry is rapidly surging and expanding with continuous innovations and increased adoption.

Given this positive sentiment, it could be wise to add fundamentally sound consumer electronics stocks like Dolby Laboratories, Inc. (DLB), Bel Fuse Inc. (BELFB), and Universal Electronics Inc. (UEIC), which have been gaining eyes in the market.

Consumer electronics brands aim to address consumers’ evolving leisure and entertainment needs, who are increasingly using more advanced technology in everyday life. According to Consumer Technology Association reports the U.S. retail sales of consumer tech are predicted to rise 2.8%, amounting to $512 billion in 2024. It is expected to exceed $525 billion in 2025.

The global market for consumer electronics is predicted to reach $1.47 trillion by 2032, growing at a CAGR of 7.6%. In 2024, revenue in the consumer electronics market in the United States is expected to total $159.90 billion.

Brands not only benefit from hardware sales but also from ecosystem engagement, such as subscriptions and digital content, further cementing their market dominance. The United States and China are the world’s largest consumers of such products, with a combined consumer electronics revenue of more than $350 billion.

In an increasingly technological landscape, the consumer electronics industry must continue to innovate in order to remain competitive. Companies focusing on cutting-edge technology, eco-friendly production, and affordability are securing a larger piece of the market pie.

Considering these conducive trends, let’s examine the Technology – Electronics industry stocks in detail, beginning with the third choice:

Stock #3: Dolby Laboratories, Inc. (DLB)

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DLB is engaged in designing and manufacturing audio and imaging hardware and software products for the cinema, DTV transmissions and devices, mobile devices, OTT video and music services, home entertainment devices, and automobiles. It develops and licenses its audio technologies, such as AAC & HE-AAC, AVC, Dolby AC-4, and Dolby Atmos technology.

On September 13, DLB launched a new comprehensive range of cloud video products and solutions supporting real-time interactive streaming. The announcement came closely after DLB’s recent acquisition of THEO Technologies, a leading provider of high-quality video streaming tools.

FanDuel, ITV, Las Vegas Sands, NASCAR, NFL, and others are leveraging the latest solutions to increase their engagement while improving their audiences’ streaming and iGaming experiences.

On June 6, DLB announced the acquisition of GE Licensing, which owns, maintains, and licenses an extensive portfolio of IP primarily targeting the consumer digital media and electronics sectors. This strategic acquisition should strengthen DLB’s licensing businesses and help expand the scale of DLB’s intellectual property portfolio.

DLB’s total revenue for the fourth quarter (ended September 27, 2024) increased 4.9% year-over-year to $304.81 million. Further, its gross profit grew 6.2% from the prior year’s quarter to $270.81 million. Also, the company’s non-GAAP net income stood at $78.44 million, up 22.7% year-over-year, while its non-GAAP earnings per share rose 24.6% from the prior year’s quarter to $0.81.

The consensus revenue estimate of $346.15 million for the fiscal first quarter (ended December 2024) represents a 9.7% increase year-over-year. The consensus EPS estimate of $1.05 for the same quarter indicates a 4.3% improvement year-over-year. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in each of the trailing four quarters.

Over the past three months, the stock has surged 12%, closing the last trading session at $80.55.

DLB’s POWR Ratings reflect this robust outlook. The stock has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

DLB has an A grade for Quality and a B for Sentiment. It is ranked #6 out of 43 stocks in the Technology – Electronics industry. Click here to see the additional ratings for DLB (Growth, Value, Momentum, and Stability).

Stock #2: Bel Fuse Inc. (BELFB)

BELFB is a designer, manufacturer, and provider of products that power, protect, and connect electronic circuits. The company operates through three segments: Power Solutions and Protection; Connectivity Solutions; and Magnetic Solutions.

On November 14, BELFB announced the completion of 80% of the acquisition of Enercon Technologies, Ltd. for $320 million. This acquisition allows BELFB to extend its product portfolio supporting the aerospace and defense markets to include power solutions, with clear potential cross-selling opportunities and expanding its footprint further into India.

On November 1, demonstrating its commitment to returning value to shareholders, the company declared a quarterly dividend of $0.06 per share on the Company’s Class A common shares and $0.07 per share on the company’s Class B common shares, payable to its shareholders on February 1, 2024. BELFB pays an annual dividend of $0.28, which translates to a yield of 0.35% at the current share price. Its four-year average dividend yield is 1.14%.

In the fiscal 2024 third quarter that ended on September 30, BELFB’s net sales amounted to $123.64 million, while its Connectivity Solutions segment net sales grew 7.6% from the same period last year to $55.72 million. The company’s net income came in at $8.10 million, and its EPS for class A common shares stood at $0.61.

Analysts expect BELFB’s revenue and EPS for the current year (ending December 2024) to be $517.11 million and $4.18, respectively. For the fiscal year 2025, its revenue and EPS are expected to grow marginally by 4.7% from the prior year to $517.11 million and $4.38, respectively.

Shares of BELFB have gained 58.8% over the past nine months and 43.5% over the past year to close the last trading session at $79.41.

BELFB’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.

It also has a B grade for Value, Sentiment, and Quality. Within the same industry, it is ranked #5. Click here to see BELFB’s ratings for Growth, Momentum, and Stability.

Stock #1: Universal Electronics Inc. (UEIC)

UEIC designs, develops, manufactures, ships, and supports control and sensor technology solutions internationally. It provides voice-enabled, automatically-programmed universal two-way radio frequency and infrared remote controls to video service providers, Original Equipment Manufacturers (OEMs), retailers, and private label customers.

For the third quarter of 2024, which ended on September 30, UEIC’s adjusted non-GAAP gross profit increased 9.2% year-over-year to $30.76 million, and its non-GAAP operating income stood at $2.57 million, indicating a 298% growth from the prior-year quarter period.

The company’s adjusted non-GAAP net income stood at $1.36 million compared to the prior-year quarter’s loss of $658 thousand, while its adjusted non-GAAP EPS came in at $0.10 versus a loss of $0.05 per share last year.

Street expects UEIC’s revenue for the fiscal fourth quarter (ending December 2024) to increase 5% year-over-year to $102.47 million. Its EPS for the same period is expected to register a 78.6% growth from the prior year, settling at $0.13.

The stock has gained 51.5% over the past year and 46% over the past month to close the last trading session at $11.33.

It’s no surprise that UEIC has an overall rating of B, equating to a Buy in our POWR Ratings system. It has a B grade for Growth, Value, and Sentiment. Out of 43 stocks in the Technology – Electronics industry, UEIC is ranked #3.

Beyond what is stated above, we’ve also rated UEIC for Momentum, Stability, and Quality. Get all UEIC ratings here.

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DLB shares were trading at $80.59 per share on Monday afternoon, up $0.04 (+0.05%). Year-to-date, DLB has declined -5.40%, versus a 26.80% rise in the benchmark S&P 500 index during the same period.