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Despite this decline in the share price, Samsara stock is trading at a premium valuation. IOT is trading at a forward price-to-sales ratio of 7.73, much higher than the industry’s valuation of 3.68. This is further supported by Zacks Value Score of F.
Samsara Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
Given these dynamics, the investors ask: Should they buy, hold or sell Samsara stock? Let’s dive into the fundamentals of the company to answer this question.
Samsara Gains From Strong Adoption of Connected Platform
Samsara is experiencing strong momentum as enterprises are implementing its Connected Operations platform that brings together IoT hardware, cloud, AI, video telematics and workflow automation in one integrated system. That combination is becoming increasingly attractive for organizations that want to improve safety, efficiency and sustainability while also reducing the complexity of managing disconnected tools.
The company’s latest fiscal 2026 results show that this strategy is resonating with customers. Samsara ended the year with annual recurring revenues (ARR) of $1.89 billion, up 30% year over year. Net new ARR reached $432 million for the full year, rising 21%, while fourth-quarter net new ARR climbed 33% to $144.8 million. Revenues also remained strong, rising 28% in the fourth quarter to $444.3 million and 30% for the full year to $1.62 billion.
Samsara’s strong performance is driven by growing adoption among large enterprises. These customers often operate complex fleet, industrial assets and frontline workforces, making them a natural fit for a platform that can unify safety, maintenance, routing and asset visibility. At the end of fiscal 2026, Samsara had 3,194 customers with more than $100,000 in ARR, including 204 additions in the fourth quarter alone. ARR from these customers rose 37% year over year to $1.2 billion.
Even more encouraging is the company’s traction with its largest accounts. ARR from customers contributing more than $1 million annually grew 56% year over year in the fourth quarter. During the quarter, Samsara signed a record 13 deals worth more than $1 million in net new annual contract value. This signals that the company is not only adding customers, but also deepening relationships with major enterprises that are expanding their use of the platform.
Samsara is also seeing strong multiproduct adoption. About 96% of customers with more than $100,000 in ARR now use at least two products, while 69% use three or more. Nine of the top 10 net new ACV deals in the fourth quarter included two or more products. That trend matters because it shows the platform is becoming more embedded in day-to-day operations rather than being used for a single point solution.
Samsara Growing on the Back of AI as Its Core Differentiator
Samsara processes more than 25 trillion data points annually, up sharply from 14 trillion in fiscal 2025, 9 trillion in fiscal 2024 and 6 trillion in fiscal 2023. This expanding data scale gives Samsara a large and growing operational dataset spanning dashcam imagery, GPS information, maintenance workflows, sensor readings and route-level data gathered from millions of connected devices.
Another important growth driver is the rise of Samsara’s newer products. Offerings launched over the last two years accounted for 23% of net new ACV in the fourth quarter, showing that customers are responding to the company’s broader product expansion. These products include AI Multicam, Connected Asset Maintenance, Asset Tags, Commercial Navigation, Qualifications, Routing, Training and Connected Workflows.
Samsara is also showing better operating leverage. Non-GAAP operating margin expanded 500 basis points year over year in the fourth quarter to 21%, while full-year fiscal 2026 non-GAAP operating margin improved to 17% from 9% in fiscal 2025. Adjusted free cash flow reached $62.9 million in the fourth quarter, with a margin of 14%, and full-year adjusted free cash flow rose to $208.7 million from $111.5 million a year earlier.
This combination of growth and profitability is important because it suggests the company’s platform model is becoming more scalable. Management pointed to durable growth and improving leverage as evidence that its go-to-market approach and product strategy are working together effectively. The Zacks Consensus Estimate for Samsara’s fiscal 2027 earnings shows growth of 21.4%. The estimates have remained unchanged in the past 60 days.
Image Source: Zacks Investment Research
Samsara Grapples With Stiff Competition in Vehicle Telematics
Samsara operates in a highly competitive market. Players include Motive, Lytx, Verizon (VZ - Free Report) , Trimble (TRMB - Free Report) and Geotab in the vehicle telematics space and PTC (PTC - Free Report) in the industrial Internet of Things space. To compete with these companies, Samsara is investing heavily in its operations, such as sales and marketing and research and development.
Verizon offers products like Connect Reveal, Connect Fleet and Connect Asset Tracking to address GPS fleet tracking, driver behavior monitoring, compliance and reporting for enterprise fleet management, equipment and trailer tracking. Trimble offers Fleet Management, Asset Tracking and Transportation Management System, coming head-on with Samsara’s offerings.
Samsara still bets on the video telematics market, which is underpenetrated. However, Trimble Video Intelligence and Verizon’s dashcams & AI video telematics pose a threat to it. Moreover, in the industrial Internet of Things space, PTC has products like ThingWorx, Kepware, Vuforia and ServiceMax, making it a formidable competitor to Samsara. Despite intense competition, Samsara is targeting a vast, underpenetrated market, one where multiple players are positioned to capture meaningful share.
Conclusion: Hold Samsara for Now. Although the vehicle telematics and industrial Internet of Things space is highly competitive, the market remains highly underpenetrated, especially in the video telematics space, giving Samsara an opportunity to grab a meaningful share. The company has recently turned profitable, enabling it to prove its business strategy. Considering these factors, we suggest investors retain this Zacks Rank #3 (Hold) stock.
View the Zacks #1 Rank List
Image: Bigstock
Samsara Declines 22.4% Year to Date: Buy, Hold or Sell the Stock?
Key Takeaways
Samsara Inc. (IOT - Free Report) shares have declined 22.4% year to date, underperforming the Zacks Internet - Software industry’s 14.4% decline and the Zacks Computer and Technology sector’s return of 15.3%.
Samsara YTD Performance Chart
Image Source: Zacks Investment Research
Despite this decline in the share price, Samsara stock is trading at a premium valuation. IOT is trading at a forward price-to-sales ratio of 7.73, much higher than the industry’s valuation of 3.68. This is further supported by Zacks Value Score of F.
Samsara Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
Given these dynamics, the investors ask: Should they buy, hold or sell Samsara stock? Let’s dive into the fundamentals of the company to answer this question.
Samsara Gains From Strong Adoption of Connected Platform
Samsara is experiencing strong momentum as enterprises are implementing its Connected Operations platform that brings together IoT hardware, cloud, AI, video telematics and workflow automation in one integrated system. That combination is becoming increasingly attractive for organizations that want to improve safety, efficiency and sustainability while also reducing the complexity of managing disconnected tools.
The company’s latest fiscal 2026 results show that this strategy is resonating with customers. Samsara ended the year with annual recurring revenues (ARR) of $1.89 billion, up 30% year over year. Net new ARR reached $432 million for the full year, rising 21%, while fourth-quarter net new ARR climbed 33% to $144.8 million. Revenues also remained strong, rising 28% in the fourth quarter to $444.3 million and 30% for the full year to $1.62 billion.
Samsara’s strong performance is driven by growing adoption among large enterprises. These customers often operate complex fleet, industrial assets and frontline workforces, making them a natural fit for a platform that can unify safety, maintenance, routing and asset visibility. At the end of fiscal 2026, Samsara had 3,194 customers with more than $100,000 in ARR, including 204 additions in the fourth quarter alone. ARR from these customers rose 37% year over year to $1.2 billion.
Even more encouraging is the company’s traction with its largest accounts. ARR from customers contributing more than $1 million annually grew 56% year over year in the fourth quarter. During the quarter, Samsara signed a record 13 deals worth more than $1 million in net new annual contract value. This signals that the company is not only adding customers, but also deepening relationships with major enterprises that are expanding their use of the platform.
Samsara is also seeing strong multiproduct adoption. About 96% of customers with more than $100,000 in ARR now use at least two products, while 69% use three or more. Nine of the top 10 net new ACV deals in the fourth quarter included two or more products. That trend matters because it shows the platform is becoming more embedded in day-to-day operations rather than being used for a single point solution.
Samsara Growing on the Back of AI as Its Core Differentiator
Samsara processes more than 25 trillion data points annually, up sharply from 14 trillion in fiscal 2025, 9 trillion in fiscal 2024 and 6 trillion in fiscal 2023. This expanding data scale gives Samsara a large and growing operational dataset spanning dashcam imagery, GPS information, maintenance workflows, sensor readings and route-level data gathered from millions of connected devices.
Another important growth driver is the rise of Samsara’s newer products. Offerings launched over the last two years accounted for 23% of net new ACV in the fourth quarter, showing that customers are responding to the company’s broader product expansion. These products include AI Multicam, Connected Asset Maintenance, Asset Tags, Commercial Navigation, Qualifications, Routing, Training and Connected Workflows.
Samsara is also showing better operating leverage. Non-GAAP operating margin expanded 500 basis points year over year in the fourth quarter to 21%, while full-year fiscal 2026 non-GAAP operating margin improved to 17% from 9% in fiscal 2025. Adjusted free cash flow reached $62.9 million in the fourth quarter, with a margin of 14%, and full-year adjusted free cash flow rose to $208.7 million from $111.5 million a year earlier.
This combination of growth and profitability is important because it suggests the company’s platform model is becoming more scalable. Management pointed to durable growth and improving leverage as evidence that its go-to-market approach and product strategy are working together effectively. The Zacks Consensus Estimate for Samsara’s fiscal 2027 earnings shows growth of 21.4%. The estimates have remained unchanged in the past 60 days.
Image Source: Zacks Investment Research
Samsara Grapples With Stiff Competition in Vehicle Telematics
Samsara operates in a highly competitive market. Players include Motive, Lytx, Verizon (VZ - Free Report) , Trimble (TRMB - Free Report) and Geotab in the vehicle telematics space and PTC (PTC - Free Report) in the industrial Internet of Things space. To compete with these companies, Samsara is investing heavily in its operations, such as sales and marketing and research and development.
Verizon offers products like Connect Reveal, Connect Fleet and Connect Asset Tracking to address GPS fleet tracking, driver behavior monitoring, compliance and reporting for enterprise fleet management, equipment and trailer tracking. Trimble offers Fleet Management, Asset Tracking and Transportation Management System, coming head-on with Samsara’s offerings.
Samsara still bets on the video telematics market, which is underpenetrated. However, Trimble Video Intelligence and Verizon’s dashcams & AI video telematics pose a threat to it. Moreover, in the industrial Internet of Things space, PTC has products like ThingWorx, Kepware, Vuforia and ServiceMax, making it a formidable competitor to Samsara. Despite intense competition, Samsara is targeting a vast, underpenetrated market, one where multiple players are positioned to capture meaningful share.
Conclusion: Hold Samsara for Now. Although the vehicle telematics and industrial Internet of Things space is highly competitive, the market remains highly underpenetrated, especially in the video telematics space, giving Samsara an opportunity to grab a meaningful share. The company has recently turned profitable, enabling it to prove its business strategy. Considering these factors, we suggest investors retain this Zacks Rank #3 (Hold) stock.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.