IEH Corporation (IEHC:OTCQX)
IEHC operates in a niche, high-barrier duopoly for hyperboloid connectors alongside Smiths Interconnect, supporting durable pricing power and limited competition. The Company’s record ~$40M backlog (more than doubling YoY), reflects a sustained 3-6+ year demand cycle driven by global missile/defense missile production ramp-ups.
IEHC is leveraged to long-term growth across defense, commercial aerospace, and space, all of which we believe are in secular bull markets. The Company also looks to diversify its business into the medical devices segment and utilize M&A.
The Company has seen margin compression over recent years due to the rising gold price; however, the Company is now implementing pricing increases.
IEHC trades at a discount to peers and precedent transactions, offering re-rating potential as growth and margin expansion materialize.
Investment Summary
Company Description
For 85 years and four generations of family-run management, IEH Corporation has designed, developed, and manufactured printed circuit board (PCB) connectors, custom interconnects and contacts for high-performance applications. With its signature Hyperboloid technology, IEH supplies the most durable, reliable connectors for the most demanding environments. The Company markets primarily to companies in defense, aerospace, space and industrial applications. The Company was founded in 1941 and is headquartered in Brooklyn, New York.
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