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Robots Will Rule 2021: 5 Stocks Poised to Benefit

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Sreoshi Bera
·7 min read
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Advancement in technology has brought robots portrayed in sci-fi movies to life in the past decade. The robotics industry has witnessed a boom with dramatic adoption in the automotive, healthcare and defense sectors. From machines cleaning our homes to managing warehouses, there is more to robots than we have seen so far.

2020 emerged as a year of impressive transformation, with the pandemic accelerating the adoptation of virtual infrastructure and network to ensure seamless transition into secured remote work environments. Digital technology adoption helped technology stocks shoot up during the year, while other businesses struggled to stay afloat. Among the technology players are some robotics and automation stocks that stood out last year and showed businesses the competitive advantages of digitization. Hence, with strong prospects and researches in progress, 2021 could be a great year to invest in robotic stocks.

 

Domestic Robots to Stay in Demand

Lockdowns drove demand for cleaning bots and home vacuum cleaners in 2020. A company that makes Robovacs sold nearly 75 of these cleaning bots in a quarter in 2019. Since the pandemic outbreak, Gopal Jeyaraj, Head (India & SAARC), Anker Innovations, reportedthat sales have jumped 20 times every quarter in 2020. While the pandemic surely gets the credit for the boom in cleaning bots, high domestic worker employment cost is an important factor that bumped up adoption of robots in cleaning.

The remote working trend helped many employees shift to the suburbs and maintain a work and family life balance. People can easily find more time for household work as they can save time spent on traveling to and fro offices. In fact, domestic robots are easily replacing domestic helps as they are cheaper and more reliable. AI-powered cleaning bots have machine learning and virtual reality environment that can easily determine the best movements around the house, without human control and simultaneously vacuum clean and mop. These bots can be automated to clean at a particular time everyday and charge themselves when the battery runs low.

Additionally, developments in machine vision cameras using AI technologies help these bots to effectively map edges of the floor and staircase, and also recognize obstacles, such as cables, dustbins, doorsills, and rugs. According to a Research and Markets’ report, the household robots market is expected to see a CAGR of 20.50% between 2020 and 2025.

Robotic-Assisted Surgery to Expand 

  Surgical robots are one of the major revenue generators of the medical robots segment. In fact, technological advancements, advantages of robotic-assisted surgery, and rapid adoption of surgical bots by hospitals and ambulatory surgery centers helped this segment grow by leaps and bounds.

Additionally, increase in chronic diseases has helped the robotic-assisted surgery market expand. Chronic diseases like cancer, cardiovascular disease, neurological disorders, stroke, diabetes, and others have escalated in the past decade and increased the need for surgical procedures. Microsurgery robots that can be used in neurological, oncological and cardiovascular surgeries are gaining importance. Hence, hospitals and ambulatory surgery centers are rapidly incorporating or adopting these advanced surgical robots. This in turn drives the number of robotic-assisted surgical procedures. What’s more? robot-assisted surgeries have advantages like less pain, low chances of infection, less human error and reduced hospital stay.

Intuitive Surgical, a pioneer of robotic surgical equipment in America, has jumped nearly 34% last year compared to the S&P 500’s rise of 14%. According to Markets and Markets’ report, the market for surgical robots is expected to rise from $6.7 billion in 2020 to $11.8 billion by 2025, at a CAGR of 12.1%.

 

IPO and Funding Boost Robotics Space

According to a CNBC report, on Dec 17, robotic process automation company, UiPath, filed for confidential IPO.  The company builds software robots powered by AI to help companies automate certain work processes, enabling human minds to focus on other non-generic work. UiPath that currently earns revenues of $360 million annually has more than 6,300 customers, including giants like Amazon, Bank of America, and Verizon. UiPath has raised $225 million in 2020 and has a valuation of $10.2 billion.

While some robotics companies are going public, others are raising funds to bump up R&D to meet the rising demand. AMP Robotics, a company that makes robotic systems to sort recyclable material, closed a $55-million series B funding round led by XN on Jan 4. In December 2020, robotic exoskeleton manufacturer, German Bionic, announced closing a $20-million financing round from multiple investors. This investment will help German Bionic ramp up development of its cloud robotics platform.

 

5 Stocks to Buy

Robots are now playing a dramatic role is several sectors of our life, in fact, the changing lifestyle demand for quick, precise and cost efficient modes, which robots can cater to. According to Statista Research Department’s report, the global robotics market is expected to reach nearly $210 billion by 2025, at a CAGR of nearly 26%. With strong prospects, it is expected that the robotics segment will continue to boom in 2021. Hence, we have shortlisted five robotics and related stocks that are poised to return well.

Trimble Inc. TRMB offers technology for video robotic control, scene documentation and photogrametric measurements. Trimble in collaboration with Boston Dynamics as well as others provides vision-based robotics solutions and AI-powered mapping systems that are an integral part of cleaning bots. Trimble’s expected earnings growth rate for the next quarter is 8.2% against the Zacks Electronics - Miscellaneous Products industry’s projected earnings decline of 70.3%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 10.9% upward over the past 60 days. Trimble holds a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Rockwell Automation, Inc. ROK provides industrial automation and digital transformation solutions. The company’s expected earnings growth rate for the current year is 12.5% compared with the Zacks Industrial Automation and Roboticsindustry’s projected earnings growth of 10.9%. The Zacks Consensus Estimate for this Zacks Rank #2 (Buy) company’s current-year earnings has been revised 9.6% upward over the past 60 days.

ReWalk Robotics Ltd. RWLK is a medical device company that designs, develops, and commercializes robotic exoskeletons for individuals with mobility impairments or other medical conditions. The company that belongs to the Zacks Medical - Instruments industry has an expected earnings growth rate of 62.2% for the next quarter.  The Zacks Consensus Estimate for the company’s next-quarter earnings has been revised 6.7% upward over the past 60 days. ReWalk Robotics holds a Zacks Rank #2.

Fanuc Corporation FANUY provides a factory automation product, which includes servo motors, lasers, robots, compact machining centers, electric injection molding machines and more. The company makes robot arms that are trained to pick items out of bins and can be used for tedious, time-consuming tasks like sorting bulk orders of parts. Fanuc’s expected earnings growth rate for the current year is 11.1% compared with the Zacks Industrial Automation and Robotics industry’s projected earnings growth of 10.9%. The Zacks Consensus Estimate for this Zacks Rank #2 company’s current-year earnings has been revised 17.7% upward over the past 60 days.

Stryker Corporation SYK operates as a medical technology company that engages inrobotic-arm assisted surgery. The company that belongs to the Zacks Medical - Products industry has an expected earnings growth rate of 39.1% in the next quarter.  The Zacks Consensus Estimate for the company’s current-year earnings has been revised 0.7% upward over the past 60 days. Stryker holds a Zacks Rank #2.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

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 >>


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Stryker Corporation (SYK) : Free Stock Analysis Report
 
Trimble Inc. (TRMB) : Free Stock Analysis Report
 
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ReWalk Robotics Ltd (RWLK) : Free Stock Analysis Report
 
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