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Here's Why Investing in Zebra Technologies (ZBRA) Makes Sense
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Zebra Technologies Corporation (ZBRA - Free Report) is poised to gain from strong demand for services and software products, acquired assets and shareholder-friendly moves.
Let’s delve into the factors that make this current Zacks Rank #1 (Strong Buy) company a smart investment choice at the moment.
Business Strength: Zebra Technologies is benefiting from growth across services and software, and RFID (radio frequency identification) products. Increased units under support contracts and retail software wins are aiding the sales of services and software. Increased sales of RFID products, driven by robust demand in retail and retail apparel markets, and increased parcel tracking in transportation logistics markets and airports are aiding the company’s growth. Also, Zebra Technologies has been advancing digital capabilities, optimizing the supply chain, expanding data analytics capability and focusing on marketing activities to better engage with customers.
Expansion Efforts: Over time, Zebra Technologies has steadily strengthened its business through acquisitions. In this regard, the company’s acquisition of Matrox Imaging (June 2022) enabled it to combine its fixed industrial scanning and machine vision portfolio with the latter’s expertise in the imaging market. Its acquisition of antuit.ai (October 2021) complemented the planning and demand forecasting module for its retail software portfolio.
Its Fetch Robotics buyout (August 2021) strengthened its capability to offer a comprehensive line of advanced robotics solutions to customers. Also, with the buyout of Adaptive Vision (May 2021), the company entered into the fixed industrial scanning and machine vision end markets. It boosted its fixed industrial scanning and machine vision solution offerings.
Cost-Management Actions: Zebra Technologies remains focused on cost-management actions. The company’s operating expenses declined 8.6% year over year in the first quarter, driven by its exit and restructuring actions. Also, Zebra Technologies’ adjusted gross margin increased 60 basis points to 48.1%, supported by higher services and software margins, and lower premium supply-chain costs. The company seeks to develop differentiated products, improve sales capacity and become more cost-effective in the near term. These efforts are likely to boost margins and produce more fuel to invest in organic growth.
Rewards to Shareholders: ZBRA’s measures to continue rewarding its shareholders despite the slowdown in markets hold promise. Though the company did not repurchase any shares in the first three months of 2024, it repurchased shares worth $52 million in 2023. In May 2022, Zebra Technologies announced that its board of directors had authorized a share repurchase program for up to $1 billion of its outstanding shares of common stock. Exiting the first quarter of 2024, the company had $893 million share outstanding under the May 2022 program.
Northward Estimate Revision: The Zacks Consensus Estimate for ZBRA’s 2024 earnings has been revised 6.7% upward in the past 60 days.
Price Performance: Shares of Zebra Technologies have gained 20.5% in the past year.
Image Source: Zacks Investment Research
Other Stocks to Consider
Some other top-ranked companies from the Industrial Products sector are discussed below.
The consensus estimate for BDC’s 2024 earnings has increased 8.3% in the past 60 days. Shares of Belden have risen 12.1% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 8.2%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has improved 1.2% in the past 60 days. The stock has risen 53.7% in the past year.
Greif, Inc. (GEF - Free Report) presently carries a Zacks Rank of 2. GEF delivered a trailing four-quarter earnings surprise of 150.6%, on average.
The consensus estimate for GEF’s fiscal 2024 earnings has increased 9% in the past 60 days. Its shares have risen 2.8% in the past year.
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Here's Why Investing in Zebra Technologies (ZBRA) Makes Sense
Zebra Technologies Corporation (ZBRA - Free Report) is poised to gain from strong demand for services and software products, acquired assets and shareholder-friendly moves.
Let’s delve into the factors that make this current Zacks Rank #1 (Strong Buy) company a smart investment choice at the moment.
Business Strength: Zebra Technologies is benefiting from growth across services and software, and RFID (radio frequency identification) products. Increased units under support contracts and retail software wins are aiding the sales of services and software. Increased sales of RFID products, driven by robust demand in retail and retail apparel markets, and increased parcel tracking in transportation logistics markets and airports are aiding the company’s growth. Also, Zebra Technologies has been advancing digital capabilities, optimizing the supply chain, expanding data analytics capability and focusing on marketing activities to better engage with customers.
Expansion Efforts: Over time, Zebra Technologies has steadily strengthened its business through acquisitions. In this regard, the company’s acquisition of Matrox Imaging (June 2022) enabled it to combine its fixed industrial scanning and machine vision portfolio with the latter’s expertise in the imaging market. Its acquisition of antuit.ai (October 2021) complemented the planning and demand forecasting module for its retail software portfolio.
Its Fetch Robotics buyout (August 2021) strengthened its capability to offer a comprehensive line of advanced robotics solutions to customers. Also, with the buyout of Adaptive Vision (May 2021), the company entered into the fixed industrial scanning and machine vision end markets. It boosted its fixed industrial scanning and machine vision solution offerings.
Cost-Management Actions: Zebra Technologies remains focused on cost-management actions. The company’s operating expenses declined 8.6% year over year in the first quarter, driven by its exit and restructuring actions. Also, Zebra Technologies’ adjusted gross margin increased 60 basis points to 48.1%, supported by higher services and software margins, and lower premium supply-chain costs. The company seeks to develop differentiated products, improve sales capacity and become more cost-effective in the near term. These efforts are likely to boost margins and produce more fuel to invest in organic growth.
Rewards to Shareholders: ZBRA’s measures to continue rewarding its shareholders despite the slowdown in markets hold promise. Though the company did not repurchase any shares in the first three months of 2024, it repurchased shares worth $52 million in 2023. In May 2022, Zebra Technologies announced that its board of directors had authorized a share repurchase program for up to $1 billion of its outstanding shares of common stock. Exiting the first quarter of 2024, the company had $893 million share outstanding under the May 2022 program.
Northward Estimate Revision: The Zacks Consensus Estimate for ZBRA’s 2024 earnings has been revised 6.7% upward in the past 60 days.
Price Performance: Shares of Zebra Technologies have gained 20.5% in the past year.
Image Source: Zacks Investment Research
Other Stocks to Consider
Some other top-ranked companies from the Industrial Products sector are discussed below.
Belden Inc. (BDC - Free Report) presently carries a Zacks Rank #2 (Buy) and has a trailing four-quarter earnings surprise of 14.7%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for BDC’s 2024 earnings has increased 8.3% in the past 60 days. Shares of Belden have risen 12.1% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 8.2%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has improved 1.2% in the past 60 days. The stock has risen 53.7% in the past year.
Greif, Inc. (GEF - Free Report) presently carries a Zacks Rank of 2. GEF delivered a trailing four-quarter earnings surprise of 150.6%, on average.
The consensus estimate for GEF’s fiscal 2024 earnings has increased 9% in the past 60 days. Its shares have risen 2.8% in the past year.