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Spotting Winners: AMETEK (NYSE:AME) And Internet of Things Stocks In Q1


Petr Huřťák /
2024/07/08 3:41 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at AMETEK (NYSE:AME) and its peers.

Industrial Internet of Things (IoT) companies are buoyed by the secular trend of a more connected world. They often specialize in nascent areas such as hardware and services for factory automation, fleet tracking, or smart home technologies. Those who play their cards right can generate recurring subscription revenues by providing cloud-based software services, boosting their margins. On the other hand, if the technologies these companies have invested in don’t pan out, they may have to make costly pivots.

The 7 internet of things stocks we track reported a mixed Q1; on average, revenues beat analyst consensus estimates by 1%. while next quarter's revenue guidance was 2.6% below consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and while some of the internet of things stocks have fared somewhat better than others, they collectively declined, with share prices falling 4.3% on average since the previous earnings results.

AMETEK (NYSE:AME)

Started from its humble beginnings in motor repair, AMETEK (NYSE:AME) manufactures electronic devices used in industries like aerospace, power, and healthcare.

AMETEK reported revenues of $1.74 billion, up 8.7% year on year, falling short of analysts' expectations by 2.4%. It was a weak quarter for the company, with a miss of analysts' organic revenue estimates.

"I am very pleased with our results in the first quarter," said David A. Zapico, AMETEK Chairman and Chief Executive Officer.

AMETEK Total Revenue

AMETEK delivered the weakest performance against analyst estimates of the whole group. The stock is down 5.3% since the results and currently trades at $164.76.

Is now the time to buy AMETEK? Access our full analysis of the earnings results here, it's free.

Best Q1: Rockwell Automation (NYSE:ROK)

One of the first companies to address industrial automation, Rockwell Automation (NYSE:ROK) sells products that help customers extract more efficiency from their machinery.

Rockwell Automation reported revenues of $2.13 billion, down 6.6% year on year, outperforming analysts' expectations by 3.5%. It was an exceptional quarter for the company, with an impressive beat of analysts' organic revenue estimates and a decent beat of analysts' earnings estimates.

Rockwell Automation Total Revenue

The stock is down 4.9% since the results and currently trades at $264.07.

Is now the time to buy Rockwell Automation? Access our full analysis of the earnings results here, it's free.

Weakest Q1: SmartRent (NYSE:SMRT)

Founded by an employee at a real estate rental company, SmartRent (NYSE:SMRT) provides smart home devices and software for multifamily residential properties, single-family rental homes, and student housing communities.

SmartRent reported revenues of $50.49 million, down 22.4% year on year, falling short of analysts' expectations by 1.2%. It was a weak quarter for the company, with a miss of analysts' earnings estimates.

SmartRent had the slowest revenue growth in the group. The stock is down 4.1% since the results and currently trades at $2.35.

Read our full analysis of SmartRent's results here.

Vontier (NYSE:VNT)

A spin-off of a spin-off, Vontier (NYSE:VNT) provides electronic products and systems to the transportation, automotive, and manufacturing sectors.

Vontier reported revenues of $755.8 million, down 2.7% year on year, in line with analysts' expectations. It was a slower quarter for the company, with revenue guidance for next quarter missing analysts' expectations and underwhelming earnings guidance for the full year.

The stock is down 6.3% since the results and currently trades at $38.07.

Read our full, actionable report on Vontier here, it's free.

Arlo (NYSE:ARLO)

With its name deriving from the Old English word meaning “to see,” Arlo (NYSE:ARLO) provides home security products and other accessories to protect homes and businesses.

Arlo reported revenues of $124.2 million, up 11.9% year on year, in line with analysts' expectations. It was a weak quarter for the company with EBITDA missing analysts' expectations.

The stock is down 5.2% since the results and currently trades at $13.21.

Read our full, actionable report on Arlo here, it's free.

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