The 3 Best Robotics Stocks to Buy in February 2024
Robotics has the potential to transform various industries, particularly manufacturing and healthcare, by creating new opportunities for automation and efficiency. The sector could very well be on its way to entering a hyper-growth stage as technological advances continue to make these technologies not only possible but efficient. Investors looking to balance long-term returns with exposure to cutting-edge technologies should look no further than these three robotics stocks in February 2024.
Intuitive Surgical (ISRG)
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Intuitive Surgical (NASDAQ:ISRG) is the pioneer and market leader in robotic-assisted surgery. The company’s flagship product, the da Vinci Surgical System, enables surgeons to perform minimally invasive procedures with enhanced precision, control and dexterity. The system has been used in over 13 million surgeries across various specialties such as urology, gynecology, general surgery and cardiothoracic surgery. The robotics company’s revenue model also embeds a lucrative recurring element tied to the services and operational leases related to the da Vinci product.
In its most recent Q4 earnings print, ISRG beat Wall Street’s estimates on both revenue and EPS estimates. Higher volume for the da Vinci Surgical System ultimately led to the high-performing numbers the company reported. The stock surged around 10% after the report came out.
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Because Intuitive Surgical’s core product growth remains impressive, this could be an attractive buying opportunity for investors before shares rally again.
Teradyne (TER)
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Teradyne (NASDAQ:TER) is a leading provider of automated test equipment for semiconductors, electronics, wireless devices and industrial automation. The company’s products help ensure the quality and performance of various devices and systems that power the modern world. Teradyne’s robotics segments consist of Universal Robots, a leading supplier of collaborative robotic arms, and Mobile Industrial Robots, a leading maker of autonomous robots for industrial purposes.
Because Teradyne is both a supplier of robotics parts and a provider of autonomous robots, the company’s revenue streams are quite diversified. A strong position in the fast-growing semiconductor testing market also helps to offset any potential slack in the robotics segment.
Teradyne’s Q4 earnings report saw the company’s robotics segment grow by 50% on a quarter-to-quarter basis, offsetting some slack in its system-on-a-chip (SoC) test systems business segment. The company is moving in a good direction and trading at 30.7x forward earnings. Teradyne’s valuation doesn’t look stretched either.
Zebra Technologies (ZBRA)
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Zebra Technologies (NASDAQ:ZBRA) is a leading provider of enterprise asset intelligence solutions, such as barcode scanners, printers, RFID tags, mobile computers and software. The company’s products ultimately help businesses track and manage their assets, data and workflows across various industries, such as retail, healthcare, transportation and manufacturing. The company also offers robotics solutions through Fetch Robotics, which provides robots for warehouse automation.
Unfortunately, the company’s financial figures have struggled in recent quarters due to soft demand from its end markets. The company’s most recent Q3 2023 earnings report underscored that point. Revenue decreased by 31% due to “elongated sales cycles” and “end-market softness.” The macroeconomic environment probably shares most of the blame for this. Still, as interest rates are likely to fall towards the end of 2024, Zebra’s stock, down 14% over the past 12 months, may be trading at an attractive price.
On the date of publication, Tyrik Torres did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.
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