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Itron (ITRI) Stock Rises 65.3% in a Year: Will the Rally Last?
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Itron (ITRI - Free Report) witnessed robust momentum, with shares having surged 65.3% in the past year compared with 18.5% growth of the sub-industry.
Headquartered in Liberty Lake, WA, Itron is one of the leading global suppliers of a wide range of standard, advanced and smart meters and meter communication systems. It also provides networks and communication modules, software, services and sensors for the effective management of electricity, gas and water resources for consumers.
Image Source: Zacks Investment Research
Catalysts Behind the Price Surge
Let’s delve deeper to unearth the factors working in favor of this Zacks Rank #2 (Buy) stock.
ITRI’s top-line performance is being driven by strong operational execution and easing of supply-chain issues. The Device Solutions segment is being driven by sales of water meter and communication module sales, particularly in the EMEA region. The Outcomes segment is benefiting from higher recurring and one-time services.
Itron expects increased demand for electric vehicles and distributed energy resource management to drive customer bookings. Itron anticipates 2024 bookings to result in a book-to-bill ratio of at least 1:1. In the current year, bookings are expected to gain from contributions from several government infrastructure investment programs.
Increasing customer adoption of Itron's Grid Edge Intelligence solutions is a major tailwind. The solution will improve asset management, enhance consumer experience and reduce inefficiencies.
The company expects 2027 revenues in the range of $2,600-$2,800 million and will register a CAGR of 5% to 7% from 2023-2027. The Networks and Outcomes segments are expected to register a CAGR of 4% to 6% and 12% to 15%, respectively.
The company expects 2027 gross margin in the range of 36%-38%.
Apart from a favorable rank, ITRI has a VGM Score of B. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank #1 (Strong Buy) or 2 and a VGM Score of A or B offer solid investment opportunities
A Look at Estimates
Itron’s revenues are suggested to improve year over year by 7.7% and 5.2% in 2024 and 2025, respectively.
The bottom line is anticipated to rise 3.3% and 24.2% on a year-over-year basis in 2024 and 2025, respectively.
The Zacks Consensus Estimate for 2024 and 2025 earnings per share (EPS) is pegged at $3.47 and $4.31, up 10.5% and 9.4%, respectively, in the past 60 days.
ITRI’s long-term earnings growth rate is pegged at 25%.
A Few Headwinds
Rising operating expenses coupled with a leveraged balance sheet remain major headwinds. Uncertainty prevailing over global macroeconomic conditions, as well as volatile supply-chain dynamics, remain concerning.
The Zacks Consensus Estimate for Synopsys’ 2024 EPS has improved 1.1% in the past 60 days to $13.56. SNPS’ long-term earnings growth rate is 17.5%.
Synopsys’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 4.1%. Shares of SNPS have risen 51.7% in the past year.
The Zacks Consensus Estimate for Woodward’s fiscal 2024 EPS has inched up 5.7% in the past 60 days to $5.27. WWD’s long-term earnings growth rate is 15.5%.
Woodward’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 27.2%. Shares of WWD have risen 55% in the past year.
The Zacks Consensus Estimate for Perion Network’s fiscal 2024 EPS has improved 0.6% in the past 60 days to $3.34. PERI’s long-term earnings growth rate is 22%.
The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 12.9%. Shares of PERI have lost 34.2% in the past year.
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Itron (ITRI) Stock Rises 65.3% in a Year: Will the Rally Last?
Itron (ITRI - Free Report) witnessed robust momentum, with shares having surged 65.3% in the past year compared with 18.5% growth of the sub-industry.
Headquartered in Liberty Lake, WA, Itron is one of the leading global suppliers of a wide range of standard, advanced and smart meters and meter communication systems. It also provides networks and communication modules, software, services and sensors for the effective management of electricity, gas and water resources for consumers.
Image Source: Zacks Investment Research
Catalysts Behind the Price Surge
Let’s delve deeper to unearth the factors working in favor of this Zacks Rank #2 (Buy) stock.
ITRI’s top-line performance is being driven by strong operational execution and easing of supply-chain issues. The Device Solutions segment is being driven by sales of water meter and communication module sales, particularly in the EMEA region. The Outcomes segment is benefiting from higher recurring and one-time services.
Itron expects increased demand for electric vehicles and distributed energy resource management to drive customer bookings. Itron anticipates 2024 bookings to result in a book-to-bill ratio of at least 1:1. In the current year, bookings are expected to gain from contributions from several government infrastructure investment programs.
Increasing customer adoption of Itron's Grid Edge Intelligence solutions is a major tailwind. The solution will improve asset management, enhance consumer experience and reduce inefficiencies.
The company expects 2027 revenues in the range of $2,600-$2,800 million and will register a CAGR of 5% to 7% from 2023-2027. The Networks and Outcomes segments are expected to register a CAGR of 4% to 6% and 12% to 15%, respectively.
The company expects 2027 gross margin in the range of 36%-38%.
Apart from a favorable rank, ITRI has a VGM Score of B. Per Zacks’ proprietary methodology, stocks with a combination of a Zacks Rank #1 (Strong Buy) or 2 and a VGM Score of A or B offer solid investment opportunities
A Look at Estimates
Itron’s revenues are suggested to improve year over year by 7.7% and 5.2% in 2024 and 2025, respectively.
The bottom line is anticipated to rise 3.3% and 24.2% on a year-over-year basis in 2024 and 2025, respectively.
The Zacks Consensus Estimate for 2024 and 2025 earnings per share (EPS) is pegged at $3.47 and $4.31, up 10.5% and 9.4%, respectively, in the past 60 days.
ITRI’s long-term earnings growth rate is pegged at 25%.
A Few Headwinds
Rising operating expenses coupled with a leveraged balance sheet remain major headwinds. Uncertainty prevailing over global macroeconomic conditions, as well as volatile supply-chain dynamics, remain concerning.
Other Stocks to Consider
Some other top-ranked stocks from the broader technology space are Synopsys (SNPS - Free Report) , Woodward (WWD - Free Report) and Perion Network (PERI - Free Report) . Synopsys and Perion Network sport a Zacks Rank #1 at present, while Woodward carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Synopsys’ 2024 EPS has improved 1.1% in the past 60 days to $13.56. SNPS’ long-term earnings growth rate is 17.5%.
Synopsys’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 4.1%. Shares of SNPS have risen 51.7% in the past year.
The Zacks Consensus Estimate for Woodward’s fiscal 2024 EPS has inched up 5.7% in the past 60 days to $5.27. WWD’s long-term earnings growth rate is 15.5%.
Woodward’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 27.2%. Shares of WWD have risen 55% in the past year.
The Zacks Consensus Estimate for Perion Network’s fiscal 2024 EPS has improved 0.6% in the past 60 days to $3.34. PERI’s long-term earnings growth rate is 22%.
The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 12.9%. Shares of PERI have lost 34.2% in the past year.