Seeking Alpha: FEI Company Finally Showing Some Value Characteristics

It's been a long wait, but electron microscopy specialist FEI Company (NASDAQ:FEIC) is finally trading at a valuation where I think GARP investors might want to take a closer look. Of course, no opportunity comes without a cost and the price of this potential value opportunity is an eroding growth outlook that has seen estimates come down steadily for months. That, in turn, has led to a run of underperformance in the shares, which are down 3% since my last article, and underperforming relative to peers/comps like JEOL, Hitachi High-Tech, Keysight (NYSE:KEYS), PerkinElmer (NYSE:PKI) and Waters (NYSE:WAT).

Management is likely to be hard-pressed to achieve its long-term growth goal of 12% per year, and the upcoming Analyst Day may see revisions to the outlook that take another bite out of the valuation. Looking beyond that, I continue to believe that there is good growth potential in electronics, material sciences, life sciences, and resources that can support mid-to-high single-digit growth for the long term. A significant reliance on emerging markets is a risk factor, as are rival technologies, but there seems to be emerging value here.

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FEI Company Finally Showing Some Value Characteristics