What the F*** Happened to Methode Electronics? (MEI)

This OEM supplier grew investors wealth by 1.2 million percent over 40 years and has seemingly fallen apart in less than a year. How did this happen?

The Fall of the Tower of Babel, Cornelis Anthonisz, 1547, etching (Rijksmuseum)

Once great companies erode into obscurity. High-flying companies that are fraudulent under the surface collapse. These things happen, and investors shouldn’t be surprised when they do.

What has happened at Methode Electronics (NYSE: MEI) feels like an entirely different story. This was a slow-and-steady electric component manufacturer that had generated spectacular returns. At the peak of its stock price in February of 2023, the company’s return from 1980 to then was an incredible 1,200,000%.

Since its peak, the company and its stock have performed like one of those Looney Tunes running bits: one bolt is removed from a vehicle, the whole thing falls apart, and Wile E. Coyote is left holding the steering wheel as he tumbles over a cliff. The story Methode Electronics’ SEC disclosures and conference calls tell feels almost tragic.

Part of our investing process is learning to identify companies that can do well, but also how to spot major red flags that can help us avoid situations like what has happened at Methode over the past 15 months. And, as a mental exercise, let’s see if this company can be redeemed.

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It took a lot of sifting through SEC filings and conference call transcripts to figure out what happened at Methode over the past 18 months. If it were not for the Koyfin platform, I’d probably still be trying to track down all of those sources. In addition to Koyfin’s financial data and screening tools, it has years’ worth of SEC filings, conference call transcripts, news stories, and corporate press releases all in one handy dropdown.

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