Explaining The 25% Rally In Zebra Technologies’ Stock And What To Expect Going Forward

November 15th, 2019 by Trefis Team

Zebra Technologies Corporation (NASDAQ:ZBRA), a company that manufactures and sells AIDC (Automatic Identification and Data Capture) products, including: mobile computers, barcode scanners, RFID (radio frequency identification device) readers, specialty printers for barcode labeling and personal identification, real-time location systems, etc., has seen its stock price rise by close to 25% over the last month, driven by stronger Q3 2019 results that beat estimates and with the company signing the largest deal in its history. The stock has reacted strongly with the company reporting earnings of $3.43 per share in Q3 2019, much ahead of analysts’ expectation of $3.28 per share. The company has now surpassed market expectations for 14 straight quarters. The company also unveiled a multiyear deal with the U.S. Postal Service, supplying 300,000 bar code readers in 2020 as the start of a broader partnership. The $570 million deal is the largest single deal in Zebra’s history.

We ‘step back’ from these recent swings to review Zebra Technologies’ performance over the last few years, as a context for what might come next. Our Interactive dashboard Why Did Zebra Technologies Stock Rally 25% Over The Last Month And What To Expect Going Forward? reviews the near term reasons and the big picture.

A closer look at Zebra Technologies’ Total Revenues over the last few years and the outlook

Relevant Articles
  1. A Rebound In Asia Travel Will Likely Drive Estée Lauder’s Q3 Performance
  2. Higher Medical Costs Likely Weighed On CVS Health’s Q1 Earnings
  3. What’s Next For PepsiCo Stock After A Q1 Beat?
  4. Down 9% This Year, What Lies Ahead For Starbucks Stock Following Q2 Earnings?
  5. Up 9% This Year, Will Wheaton Stock Rally Further After Q1 Results?
  6. Up 25% This Year, Will Disney’s Strong Run Continue Following Q2 Results?

Total Revenues for Zebra Technologies increased from $3.72 billion in 2017 to $4.22 billion in 2018; an increase of 13.3%.

This compares with Total Revenue growth of:

  • 118% in 2015, driven by the $3.5 billion acquisition of Enterprise business from Motorola Solutions
  • -2.08% in 2016
  • 4.14% in 2017

We expect Total Revenue growth to be 6.7% in 2019.

A closer look at Zebra Technologies’ Total Expenses over the last few years and the outlook

Total Expense for Zebra Technologies marginally increased from $3.63 billion in 2017 to $3.69 billion in 2018; an increase of 1.65%.

This compares with Total Expense growth of:

  • 132% in 2015, driven by additional expenses related to acquisition of Enterprise business
  • -3.32% in 2016
  • -1.86% in 2017

We expect Total Expense growth to be 3.68% in 2019.

How Does Zebra Technologies’ Revenue Growth compare with rivals?

For more information on how Zebra Technologies’ Revenue Growth compares with Honeywell International and Catapult Group, view our interactive dashboard analysis.

How has Zebra Technologies’ EBT trended?

EBT for Zebra Technologies increased dramatically by 495% from $88.0 million in 2017 to $524 million in 2018, mainly driven by higher revenues, coupled with sharp drop in interest expense (due to debt repayment) and acquisition & integration cost.

We expect EBT to increase 27.9% to $670 million in 2019.

How has Zebra Technologies’ Net Income and EPS trended?

For more details on Zebra Technologies’ Net Income and EPS, view our interactive dashboard analysis.

 

What’s behind Trefis? See How it’s Powering New Collaboration and What-Ifs

For CFOs and Finance Teams | Product, R&D, and Marketing Teams

More Trefis Data

Like our charts? Explore example interactive dashboards and create your own.