Here's Why You Should Consider Investing in Zebra Technologies

Zebra Technologies Corporation ZBRA benefits from strength across its businesses, strategic acquisitions, cost management actions and focus on operational excellence. The company remains focused on investing in growth opportunities and solidifying its long-term market position.ZBRA, which has a market capitalization of $20.2 billion, currently flaunts a Zacks Rank #1 (Strong Buy). Let us delve into the factors that have been aiding the firm for a while now.Business Strength: Zebra Technologies has been witnessing growth across the Enterprise Visibility & Mobility segment. Higher sales of mobile computing and data capture solutions have been driving the segment’s revenues, which increased 33.7% year over year in the third quarter of 2024. An increase in sales of services and software driven by retail software wins has been also aiding the segment.Recovery in demand for printing solutions and RFID products has been also boosting the Asset Intelligence & Tracking segment’s performance. In the third quarter, the segment’s sales increased 26.5% on a year-over-year basis. Driven by strength across its business, the company expects fourth-quarter 2024 net sales to increase in the band of 28-31% year over year.Benefits From Acquisitions: The company has steadily strengthened its business through acquisitions. ZBRA’s acquisition of Matrox Imaging (June 2022) enabled it to combine the company’s fixed industrial scanning and machine vision portfolio with the latter’s expertise in the imaging market. Also, the acquisition of antuit.ai (October 2021) complemented the planning and demand forecasting module for its retail software portfolio.Cost-Management Actions: It remains focused on cost-management actions. For instance, its gross margin increased 410 basis points to 48.8%, supported by higher volume, leverage and business mix. The company completed its actions under the 2022 productivity plan and employee voluntary retirement plan in the third quarter. Under these plans, it has achieved $110 million in net savings till the third quarter, with $50 million in 2023 and $60 million in the first nine months of 2024.YTD Price Performance of ZBRAImage Source: Zacks Investment ResearchYear to date, the company’s shares have surged 43.5%, higher than the industry’s 36.9% growth.Improvement in Cash Flow: Although free cash flow was negative in 2023, the company expects the metric to be $850 million in 2024. It is worth noting that Zebra Technologies’ free cash flow amounted to $665.9 million in the first three quarters of 2024 against the free cash outflow of $193 million in the year-ago period.This should support the company’s shareholder-friendly policies. For instance, the company repurchased shares worth $16 million in the first nine months of 2024. In May 2022, its board of directors authorized a share repurchase program for up to $1 billion. Exiting the third quarter, the company had $877 million remaining under this program.Other Stocks to ConsiderSome other top-ranked companies from the same space are discussed below.Graham Corporation GHM currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.GHM delivered a trailing four-quarter average earnings surprise of 101.9%. In the past 60 days, the Zacks Consensus Estimate for Graham’s 2024 earnings has increased 8.4%.RBC Bearings RBC presently has a Zacks Rank of 2 (Buy). The company delivered a trailing four-quarter average earnings surprise of 2.5%.In the past 60 days, the Zacks Consensus Estimate for RBC’s fiscal 2025 (ending March 2025) earnings has increased 2.3%.Kadant Inc. KAI currently carries a Zacks Rank of 2. KAI delivered a trailing four-quarter average earnings surprise of 17.2%.In the past 60 days, the consensus estimate for Kadant’s 2024 earnings has increased 1.8%.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report RBC Bearings Incorporated (RBC): Free Stock Analysis Report Kadant Inc (KAI): Free Stock Analysis Report Graham Corporation (GHM): Free Stock Analysis Report Zebra Technologies Corporation (ZBRA): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks