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Zebra (ZBRA) to Report Q3 Earnings: What's in the Offing?

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  • ZBRA

Zebra Technologies Corporation ZBRA is slated to report third-quarter 2021 results on Nov 02, before market open.

The company’s earnings beat expectations in each of the trailing four quarters, the surprise being 13.30%, on average. In the last reported quarter, earnings of $4.57 per share surpassed the Zacks Consensus Estimate of $4.12 by 10.92%.

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In the past three months, the company’s shares have lost 3.7% compared with the industry’s decline of 4.1%.

Key Factors

Solid demand for Zebra’s printing and supplies, enterprise mobile computing, RFID product lines, as well as services and software is likely to have driven its top line in the third quarter. The company’s focus on supply-chain optimization, cost management actions, along with investments in software capability, is also likely to have supported its performance in the quarter. For the third quarter of 2021, the company anticipates its earnings to lie in the range of $3.90 to $4.10, suggesting year-over-year growth of 22.3% at mid-point.

Acquired assets boosted Zebra’s sales by 1.4% and 1.6% in the first and second quarters of 2021, respectively. The trend is likely to have continued in the third quarter, owing to the benefits from its buyout of Fetch Robotics, Inc. (August 2021) and Reflexis Systems, Inc. (September 2020). Fetch Robotics has been boosting the company’s capability to offer a comprehensive line of advanced robotics solutions to customers. The addition of Reflexis’ advanced workforce management and real-time task management solutions has augmented its software offerings.

However, over the past few quarters, rising cost of sales and operating expenses have been a concern for Zebra. In second-quarter 2021, its cost of sales increased 33.9% year over year. Total operating expenses surged 37% in the quarter. Despite its focus on supply-chain optimization, it has been witnessing supply-chain challenges and an increase in labor and raw material costs. High costs and expenses might have adversely impacted its margin and profitability in the to-be-reported quarter as well.

The Zacks Consensus Estimate for the company’s third-quarter total revenues is currently pegged at $1,395 million, suggesting 23.2% and 1.3% growth from the year-ago and quarter-ago reported numbers, respectively.

Zebra Technologies Corporation Price and EPS Surprise

Zebra Technologies Corporation Price and EPS Surprise
Zebra Technologies Corporation Price and EPS Surprise

Zebra Technologies Corporation price-eps-surprise | Zebra Technologies Corporation Quote

Earnings Whispers

According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or at least 3 (Hold) to increase the odds of an earnings beat. But that is not the case here as we will see below.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Zebra has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate is pegged at $3.98.

Zacks Rank: The company carries a Zacks Rank #3.

Key Picks

Here are some companies you may want to consider from the Zacks Industrial Products sector as our model shows that these have the right combination of elements to deliver an earnings beat this season:

Deere & Company DE has an Earnings ESP of +5.55% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Johnson Controls International plc JCI has an Earnings ESP of +0.17% and a Zacks Rank of 2, at present.

Plug Power, Inc. PLUG has an Earnings ESP of +2.41% and a Zacks Rank of 3.

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

Johnson Controls International plc (JCI) : Free Stock Analysis Report

Deere & Company (DE) : Free Stock Analysis Report

Plug Power, Inc. (PLUG) : Free Stock Analysis Report

Zebra Technologies Corporation (ZBRA) : Free Stock Analysis Report

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