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iRobot (IRBT) Shares Gain 43% in 3 Months: What's Driving It?
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Shares of iRobot Corporation (IRBT - Free Report) have gained notably in the past three months. Solid product offerings and a focus on innovation as well as strengthening demand through on-line platforms seem to have boosted sentiments for the stock.
The Bedford, MA-based company belongs to the Zacks Industrial Automation and Robotics industry — which comes under the ambit of the Zacks Industrial Products sector. The company has a $3.4-billion market capitalization and it currently sports a Zacks Rank #1 (Strong Buy).
In the past three months, the company’s shares have gained 44.3% compared with the industry’s growth of 7.9%. Notably, the S&P 500 has risen 6.5% and the sector has grown 30.3% during the same period.
Factors Influencing the Stock
In the past three months, iRobot has reported results for fourth-quarter 2020, with earnings exceeding estimates by 320%. Also, sales in the quarter beat estimates by 12.3%. For 2021, the company anticipates sales of $1.635-$1.675 billion, suggesting a year-over-year increase of 14-17%. Also, the top line in the first quarter of the year is expected to grow at least 35% from the year-ago quarter.
Solid product offerings and a focus on innovation as well as a solid customer base across the globe are expected to continue aiding in the quarters ahead. Notably, the company benefited from a 55% increase in revenues from premium robots in the fourth quarter of 2020. Also, it received a healthy response for the Genius Home Intelligence platform, and Roomba i3 and i3+ products. Two new variants of Roomba products will likely be launched by the company in 2021.
Additionally, iRobot has been gaining from revenues derived from online platforms and might continue to do so in the quarters ahead. Notably, revenues generated from product sales on its online platforms accounted for 60% of fourth-quarter sales. Also, efforts to strengthen revenues from direct sales to customers from 11% in 2020 to 15% in 2021 are expected to be advantageous.
In addition to the aforementioned factors, investments to boost software related to artificial intelligence, machine vision technologies and home understanding might aid. Also, brand awareness through multiple sources as well as a healthy supply chain, lower tariff exposure and manufacturing in Malaysia might be useful.
Currently, the Zacks Consensus Estimate for the company’s earnings is pegged at $3.13 for 2021 and $5.35 for 2022, marking an increase of 36.7% and 48.2% from the respective 60-day-ago figures. Also, the estimate for the first quarter improved from a loss of 27 cents to earnings of 7 cents. Such an upward revision in earnings estimates is reflective of healthy operating conditions for the company.
In the past 60 days, earnings estimates for these stocks have improved for the current year. Further, earnings surprise for the last reported quarter was 143.14% for EnPro Industries, 13.14% for Dover and 19.61% for Graco.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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iRobot (IRBT) Shares Gain 43% in 3 Months: What's Driving It?
Shares of iRobot Corporation (IRBT - Free Report) have gained notably in the past three months. Solid product offerings and a focus on innovation as well as strengthening demand through on-line platforms seem to have boosted sentiments for the stock.
The Bedford, MA-based company belongs to the Zacks Industrial Automation and Robotics industry — which comes under the ambit of the Zacks Industrial Products sector. The company has a $3.4-billion market capitalization and it currently sports a Zacks Rank #1 (Strong Buy).
In the past three months, the company’s shares have gained 44.3% compared with the industry’s growth of 7.9%. Notably, the S&P 500 has risen 6.5% and the sector has grown 30.3% during the same period.
Factors Influencing the Stock
In the past three months, iRobot has reported results for fourth-quarter 2020, with earnings exceeding estimates by 320%. Also, sales in the quarter beat estimates by 12.3%. For 2021, the company anticipates sales of $1.635-$1.675 billion, suggesting a year-over-year increase of 14-17%. Also, the top line in the first quarter of the year is expected to grow at least 35% from the year-ago quarter.
Solid product offerings and a focus on innovation as well as a solid customer base across the globe are expected to continue aiding in the quarters ahead. Notably, the company benefited from a 55% increase in revenues from premium robots in the fourth quarter of 2020. Also, it received a healthy response for the Genius Home Intelligence platform, and Roomba i3 and i3+ products. Two new variants of Roomba products will likely be launched by the company in 2021.
Additionally, iRobot has been gaining from revenues derived from online platforms and might continue to do so in the quarters ahead. Notably, revenues generated from product sales on its online platforms accounted for 60% of fourth-quarter sales. Also, efforts to strengthen revenues from direct sales to customers from 11% in 2020 to 15% in 2021 are expected to be advantageous.
In addition to the aforementioned factors, investments to boost software related to artificial intelligence, machine vision technologies and home understanding might aid. Also, brand awareness through multiple sources as well as a healthy supply chain, lower tariff exposure and manufacturing in Malaysia might be useful.
Currently, the Zacks Consensus Estimate for the company’s earnings is pegged at $3.13 for 2021 and $5.35 for 2022, marking an increase of 36.7% and 48.2% from the respective 60-day-ago figures. Also, the estimate for the first quarter improved from a loss of 27 cents to earnings of 7 cents. Such an upward revision in earnings estimates is reflective of healthy operating conditions for the company.
iRobot Corporation Price and Consensus
iRobot Corporation price-consensus-chart | iRobot Corporation Quote
Other Stocks to Consider
Some other top-ranked stocks in the sector are EnPro Industries, Inc. (NPO - Free Report) , Dover Corporation (DOV - Free Report) and Graco Inc. (GGG - Free Report) . While EnPro sports a Zacks Rank #1, both Dover and Graco carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, earnings estimates for these stocks have improved for the current year. Further, earnings surprise for the last reported quarter was 143.14% for EnPro Industries, 13.14% for Dover and 19.61% for Graco.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>