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Reasons to Retain Zebra Technologies (ZBRA) in Your Portfolio
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Zebra Technologies Corporation (ZBRA - Free Report) is gaining from growth across data capture solutions, services, software and radio frequency identification (RFID) despite low demand across end markets, lower sales of printing products and forex woes.
Let us discuss the reasons why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: Targeted list price increases and higher sales of RFID products within the Asset Intelligence and Tracking segment are aiding ZBRA’s growth. Higher sales of services and software, and contributions from recent acquisitions bode well for the Enterprise Visibility & Mobility segment. Also, improved supply chains and reduced product lead times are supporting Zebra Technologies.
Cost-Reduction Actions: ZBRA has announced expanded cost-reduction actions, including an incremental $65 million of annualized expense reductions, as it grapples with a slowdown in end markets and demand softness. Along with the previous cost-reduction actions taken over the past year, the company expects to generate approximately $100 million in cost savings annually.
Accretive Acquisition: The company’s expansion initiative is expected to drive growth. Zebra Technologies’ 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. Zebra Technologies expects approximately a 50-basis point contribution from acquisitions in 2023.
Rewards to Shareholders: The company continues to increase shareholders’ value through share repurchases. In the first nine months of 2023, the company repurchased shares worth $52 million. While free cash flow was negative in the first half of 2023, the company expects the same to be positive in the second half. This should support the company’s shareholder-friendly policies.
In light of the above-mentioned positives, we believe, investors should retain ZBRA stock for now, as suggested by its current Zacks Rank #3 (Hold).
Zebra Technologies Corporation Price and Consensus
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 38.4% 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 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.3% in the past 60 days. Shares of Applied Industrial have jumped 40.9% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 4.4%. The stock has risen 43.8% in the past year.
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Reasons to Retain Zebra Technologies (ZBRA) in Your Portfolio
Zebra Technologies Corporation (ZBRA - Free Report) is gaining from growth across data capture solutions, services, software and radio frequency identification (RFID) despite low demand across end markets, lower sales of printing products and forex woes.
Let us discuss the reasons why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: Targeted list price increases and higher sales of RFID products within the Asset Intelligence and Tracking segment are aiding ZBRA’s growth. Higher sales of services and software, and contributions from recent acquisitions bode well for the Enterprise Visibility & Mobility segment. Also, improved supply chains and reduced product lead times are supporting Zebra Technologies.
Cost-Reduction Actions: ZBRA has announced expanded cost-reduction actions, including an incremental $65 million of annualized expense reductions, as it grapples with a slowdown in end markets and demand softness. Along with the previous cost-reduction actions taken over the past year, the company expects to generate approximately $100 million in cost savings annually.
Accretive Acquisition: The company’s expansion initiative is expected to drive growth. Zebra Technologies’ 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. Zebra Technologies expects approximately a 50-basis point contribution from acquisitions in 2023.
Rewards to Shareholders: The company continues to increase shareholders’ value through share repurchases. In the first nine months of 2023, the company repurchased shares worth $52 million. While free cash flow was negative in the first half of 2023, the company expects the same to be positive in the second half. This should support the company’s shareholder-friendly policies.
In light of the above-mentioned positives, we believe, investors should retain ZBRA stock for now, as suggested by its current Zacks Rank #3 (Hold).
Zebra Technologies Corporation Price and Consensus
Zebra Technologies Corporation price-consensus-chart | Zebra Technologies Corporation Quote
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 38.4% 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 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.3% in the past 60 days. Shares of Applied Industrial have jumped 40.9% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 4.4%. The stock has risen 43.8% in the past year.