Wrapping up Q1 earnings, we look at the numbers and key takeaways for the internet of things stocks, including Emerson Electric (NYSE:EMR) 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. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and while some of the internet of things stocks have fared somewhat better than others, they collectively declined, with share prices falling 0% on average since the previous earnings results.
Emerson Electric (NYSE:EMR)
Founded in 1890, Emerson Electric (NYSE:EMR) is a multinational technology and engineering company providing solutions in the industrial, commercial, and residential markets.
Emerson Electric reported revenues of $4.38 billion, up 16.5% year on year, exceeding analysts' expectations by 2%. Overall, it was a very strong quarter for the company with a decent beat of analysts' earnings estimates.
"Emerson's outstanding execution continued in the second quarter, with sales growth, margin expansion and earnings all exceeding expectations," said Emerson President and Chief Executive Officer Lal Karsanbhai.
Emerson Electric scored the fastest revenue growth of the whole group. The stock is up 6.9% since reporting and currently trades at $114.79.
Is now the time to buy Emerson Electric? 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.
Although it had a great quarter compared its peers, the market seems unhappy with the results as the stock is down 2.3% since reporting. It currently trades at $271.08.
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 flat since the results and currently trades at $2.43.
Read our full analysis of SmartRent's results here.
Trimble (NASDAQ:TRMB)
Playing a role in the construction of the Paris Grand, Trimble (NASDAQ:TRMB) offers geospatial devices and technology to the agriculture, construction, transportation, and logistics industries.
Trimble reported revenues of $953.3 million, up 4.1% year on year, surpassing analysts' expectations by 4.5%. More broadly, it was a solid quarter for the company with a decent beat of analysts' earnings estimates.
Trimble pulled off the biggest analyst estimates beat among its peers. The stock is down 8.9% since reporting and currently trades at $54.70.
Read our full, actionable report on Trimble here, it's free.
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%. Taking a step back, it was a weak quarter for the company with a miss of analysts' organic revenue estimates.
AMETEK had the weakest performance against analyst estimates among its peers. The stock is down 3.1% since reporting and currently trades at $168.52.
Read our full, actionable report on AMETEK here, it's free.
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