B Riley Securities Downgrades Universal to Neutral with $5 PT

B Riley Securities Downgrades Universal to Neutral with $5 PT

B Riley Securities has downgraded Universal Electronics (NASDAQ:UEIC) from a Buy rating to Neutral and slashed its price target from $14.00 to $5.00, reflecting a significant change in the company's outlook. The downgrade follows the company's second-half guidance, which indicates a "considerable deterioration" in its business outlook despite earlier signs of moderation in the decline of legacy home entertainment products [1].

Universal Electronics' stock has declined by over 54% year-to-date and currently trades at just 0.44 times book value, suggesting it may be undervalued according to InvestingPro analysis. The research firm no longer expects growth for fiscal year 2025, despite the company gaining market share with higher average selling price HVAC and HASH products. The outlook beyond FY25 is described as "seemingly choppy at best," prompting the significant reduction in price target and rating change [1].

However, there are some positive developments for Universal Electronics. The company achieved positive net cash for the first time since December 2021 and secured a favorable ruling in its litigation against Roku (NASDAQ:ROKU), with a judge meeting scheduled for late September 2025. Additionally, the company reported its financial results for the second quarter of 2025, exceeding earnings expectations with an earnings per share (EPS) of $0.18 and revenue of $97.7 million [1].

Rosenblatt Securities has also 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, with the Home Control Business expanding inconsistently to counterbalance challenges in other areas [1].

In contrast, B. Riley Securities has updated its price target for Applied Materials (AMAT) to $15, maintaining a neutral rating. The new price target reflects a 14.57% increase from the current stock price of $178.14, as calculated by MarketBeat. The consensus analyst rating for AMAT stands at "Moderate Buy," with 8 analysts holding a "Hold" rating and 17 analysts recommending a "Buy." MarketBeat's consensus price target is $204.09, with the highest target at $250.00 and the lowest at $165.00 [2].

The investment in Arizona is part of a broader strategy to expand AMAT's manufacturing footprint in the United States. The company has invested over $400 million in U.S. manufacturing over the last five years, emphasizing its commitment to domestic semiconductor leadership [2].

References:
[1] https://www.investing.com/news/analyst-ratings/universal-electronics-stock-rating-downgraded-by-briley-on-weak-outlook-93CH-4181898
[2] https://www.ainvest.com/news/riley-securities-raises-pt-15-maintains-neutral-rating-applied-2508/