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Impinj Gains 18% in 3 Months: Is the Stock Worth Buying?

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Impinj’s (PI - Free Report) shares have risen 17.6% in the past three months, outperforming the Zacks Computer & Technology sector and the Zacks Electronics - Semiconductors industry’s growth of 4.5% and 1.3%, respectively.

The stock has outperformed its industry peers, including Applied Materials (AMAT - Free Report) , FormFactor (FORM - Free Report) and Lam Research (LRCX - Free Report) , in the same timeframe.

While PI's shares have been on the rise, those of Applied Materials, FormFactor and Lam Research have lost 10.8%, 16.7% and 11.2%, respectively, during the same period.

Impinj's share performance is driven by growing demand for its products and services, a wider customer base and the successful deployment of large-scale RFID solutions.

Impinj Gains on Revenue Growth and Diverse Customer Base

A significant portion of Impinj's revenues comes from its Endpoint ICs segment, which achieved $81 million in the third quarter of 2024, marking remarkable 67% year-over-year growth.

Impinj experienced strong demand in the supply chain and logistics sectors during the third quarter of 2024, with parcel shippers and retailers significantly increasing their use of endpoint ICs in preparation for the holiday season. This led to record unit volumes and exceeded expectations for endpoint IC product revenues.

The company has grown its customer base by focusing on creating RFID solutions that are scalable, efficient and advanced. Impinj's technology is designed to meet the needs of various industries like retail, logistics, healthcare and supply-chain management. By providing flexible solutions the company has been able to attract a wide range of customers.

Steady growth in the retail general merchandise segment, along with rising demand in apparel and long-tail applications, significantly boosted Impinj's overall revenues and financial performance.

Market Expansion and Product Upgrades Boost PI’s Prospects

The company has made strides in expanding its market reach and improving product offerings, aligning with PI’s vision of connecting billions of items through RFID technology. This strategy positions Impinj well within the growing Internet of Things (IoT) ecosystem.

Impinj has been expanding into the food tagging sector, focusing on quick-service restaurants and grocery pilot programs. This new market is anticipated to be much larger than its current business segments, offering significant growth potential.

For the third consecutive quarter, shipments of Impinj's M800 IC more than doubled, indicating strong market acceptance and increased adoption of this product. The company expects continued momentum in the fourth quarter, supported by more M800-based inlays.

PI has been investing in software and cloud services to drive long-term growth and boost revenues. The growing adoption of these solutions, along with successful large-scale rollouts with Fortune 500 companies, has strengthened its presence in the enterprise market.

PI’s Earnings Estimate Revision Shows Upward Trend

The Zacks Consensus Estimate for fourth-quarter 2024 earnings is currently pegged at 47 cents per share, revised upward by 11.9% in the past 60 days. This figure indicates remarkable year-over-year growth of 422.2%.

The consensus mark for fourth-quarter 2024 revenues is pegged at $92.80 million, indicating year-over-year growth of 31.4%.

For 2024, the Zacks Consensus Estimate for revenues is pegged at $367.30 million, implying year-over-year growth of 19.43%.

The consensus mark for earnings is pegged at $2.05 per share, indicating a 6.2% upward revision in the past 60 days. This indicates significant year-over-year growth of 192.9% compared with 2023.

PI’s Zacks Rank & Valuation

Impinj currently sports a Zacks Rank #1 (Strong-Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Additionally, the stock has a Growth Score of A. Our research shows that stocks with Growth Score of A or B, when combined with a Zacks Rank #1 or #2 (Buy), offer the best investment opportunities for investors. Thus, PI stock appears to be a compelling investment proposition at the moment.


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