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Zebra Technologies Corp Class A ZBRA

Morningstar Rating
$291.65 +2.01 (0.69%)
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Company Report

Zebra Earnings: 2024 Outlook Implies Stabilizing Demand, and Shares Look Closer to Fair Value

We trim our fair value estimate for narrow-moat Zebra Technologies to $320, from $345, as we temper our medium-term recovery thesis. Zebra's outlook for stabilizing demand in 2024 met our model, but we now see 2024 as a base from which normalized growth can resume, rather than a depressed level to be followed by a snapback in revenue. Zebra suffered from a combination of distributor inventory destocking and order pushouts in 2023, hampering sales. We believe weak 2023 sales reflected a correction from the surge of post-pandemic orders Zebra accrued in 2021. We continue to expect mid single digit midcycle growth for the firm, and like its wide and sticky portfolio of solutions for digital transformation. With shares up 12% on a growth outlook for 2024, we now see Zebra stock as only modestly undervalued.

Price vs Fair Value

ZBRA is trading at a 9% discount.
Price
$291.65
Fair Value
$912.00
Uncertainty
High
1-Star Price
$796.00
5-Star Price
$565.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Zebra derives 80% of its sales from a robust ecosystem of channel partners, which can customize its technology to specific subverticals.

Bears

One third of Zebra’s revenue comes from its legacy printing segment, which faces greater risk of commoditization.

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News

Trading Information

Previous Close Price
$289.64
Day Range
$286.01293.57
52-Week Range
$194.59320.55
Bid/Ask
$275.00 / $295.66
Market Cap
$14.99 Bil
Volume/Avg
222 / 416,883

Key Statistics

Price/Earnings (Normalized)
22.39
Price/Sales
3.29
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield
0.35%

Company Profile

Zebra Technologies is a leading provider of automatic identification and data capture technology to enterprises. Its solutions include barcode printers and scanners, mobile computers, and workflow optimization software. The firm primarily serves the retail, transportation logistics, manufacturing, and healthcare markets, designing custom solutions to improve efficiency at its customers.
Sector
Technology
Industry
Communication Equipment
Stock Style Box
Mid Core
Total Number of Employees
9,750

Competitors

Valuation

Metric
ZBRA
HON
6752
Price/Earnings (Normalized)
22.3921.406.74
Price/Book Value
4.948.190.81
Price/Sales
3.293.630.40
Price/Cash Flow
29.5126.745.99
Price/Earnings
ZBRA
HON
6752

Financial Strength

Metric
ZBRA
HON
6752
Quick Ratio
0.450.840.86
Current Ratio
1.051.271.39
Interest Coverage
3.519.9415.56
Quick Ratio
ZBRA
HON
6752

Profitability

Metric
ZBRA
HON
6752
Return on Assets (Normalized)
6.85%9.49%6.13%
Return on Equity (Normalized)
17.32%34.73%13.34%
Return on Invested Capital (Normalized)
11.84%16.29%8.53%
Return on Assets
ZBRA
HON
6752
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