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Will Low Demand Mar Zebra Technologies' (ZBRA) Q4 Earnings?

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Zebra Technologies Corporation (ZBRA - Free Report) is scheduled to release fourth-quarter 2022 results on Feb 16, before market open.

The Zacks Consensus Estimate for ZBRA’s fourth-quarter earnings has remained steady in the past 60 days. The company has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in three of the preceding four quarters while missing in one.

Let’s see how things have shaped up for Zebra Technologies this earnings season.

Factors to Note

Growth across data capture, printing, supplies, services and software solutions is likely to have aided Zebra Technologies’ fourth-quarter performance.

Growth in printing and supplies owing to continued improvement in product availability is expected to have driven the Asset Intelligence and Tracking segment’s performance. The Zacks Consensus Estimate for segmental revenues in the fourth quarter indicates an 8% increase from the sequential quarter’s reported figure. Acquired assets are expected to have boosted ZBRA’s top line in the to-be-reported quarter.

However, supply-chain challenges related to component shortages are likely to have affected profitability in the to-be-reported quarter. Foreign currency headwinds might have impacted the top-line performance.

Apart from these headwinds, a soft demand environment is likely to have weighed on performance. For the fourth quarter, Zebra Technologies expects adjusted net sales to either decrease up to 2% or increase up to 1%. The Zacks Consensus Estimate for net sales indicates a dip of 0.6% from the fourth quarter of 2021 reported number.

What Does the Zacks Model Say?

Our proven model does not conclusively predict an earnings beat for Zebra Technologies this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Zebra Technologies has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $4.54. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Zebra Technologies currently carries a Zacks Rank #4 (Sell).

Highlights of Q3 Earnings

Zebra Technologies reported third-quarter 2022 adjusted earnings (excluding 39 cents from non-recurring items) of $3.65 per share, missing the Zacks Consensus Estimate of $4.20. The bottom line decreased year over year. Total revenues of $1,378 million missed the Zacks Consensus Estimate of $1,476 million. The top line decreased 4% year over year. Acquisitions contributed 2.1% to the top line, while foreign-currency translation had an adverse impact of 2.9% on sales.

Stocks to Consider

Here are some companies within the broader Industrial Products sector that you may want to consider, as according to our model, these have the right combination of elements to beat on earnings this reporting cycle.

Allegion plc (ALLE - Free Report) has an Earnings ESP of +4.19% and a Zacks Rank #1. The company is set to release fourth-quarter results on Feb 22.

The Zacks Consensus Estimate for Allegion’s fourth-quarter earnings has been revised downward by 2.8% in the past 60 days. However, the company pulled off a trailing four-quarter earnings surprise of 8.8%, on average.

AptarGroup (ATR - Free Report) has an Earnings ESP of +3.28% and a Zacks Rank #3. The company is scheduled to release fourth-quarter 2022 results on Feb 16.

The Zacks Consensus Estimate for AptarGroup’s fourth-quarter earnings has been revised upward by a penny in the past 60 days. The company pulled off a trailing four-quarter earnings surprise of 0.8%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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