As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at specialized technology stocks, starting with Arlo Technologies (NYSE:ARLO).
Companies in this sector, especially if they invest wisely, could see demand tailwinds as the world moves towards more IoT (Internet of Things), automation, and analytics. Enterprises across most industries will balk at taking these journeys solo and will enlist companies with expertise and scale in these areas. However, headwinds could include rising competition from larger technology firms, as digitization lowers barriers to entry in the space. Additionally, companies in the space will likely face evolving regulatory scrutiny over data privacy, particularly for surveillance and security technologies. This could make companies have to continually pivot and invest.
The 8 specialized technology stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was in line.
Luckily, specialized technology stocks have performed well with share prices up 19.1% on average since the latest earnings results.
Best Q1: Arlo Technologies (NYSE:ARLO)
Originally spun off from networking equipment maker Netgear in 2018, Arlo Technologies (NYSE:ARLO) provides cloud-based smart security devices and subscription services that help consumers and businesses monitor and protect their homes, properties, and loved ones.
Arlo Technologies reported revenues of $119.1 million, down 4.1% year on year. This print exceeded analysts’ expectations by 0.6%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ EPS estimates.
The stock is up 56.7% since reporting and currently trades at $16.70.
Is now the time to buy Arlo Technologies? Access our full analysis of the earnings results here, it’s free.
Napco (NASDAQ:NSSC)
Protecting everything from schools to government facilities since 1969, Napco Security Technologies (NASDAQ:NSSC) manufactures electronic security devices, access control systems, and communication services for intrusion and fire alarm systems.
Napco reported revenues of $43.96 million, down 10.8% year on year, outperforming analysts’ expectations by 1.9%. The business had an exceptional quarter with a solid beat of analysts’ EPS estimates.
The market seems happy with the results as the stock is up 16% since reporting. It currently trades at $27.60.
Is now the time to buy Napco? Access our full analysis of the earnings results here, it’s free.
Zebra (NASDAQ:ZBRA)
Taking its name from the black and white stripes of barcodes, Zebra Technologies (NASDAQ:ZBRA) provides barcode scanners, mobile computers, RFID systems, and other data capture technologies that help businesses track assets and optimize operations.
Zebra reported revenues of $1.31 billion, up 11.3% year on year, exceeding analysts’ expectations by 1.4%. Still, it was a slower quarter with EPS guidance for the next quarter missing analysts' estimates.
Interestingly, the stock is up 17.3% since the results and currently trades at $285.80.
Read our full analysis of Zebra’s results here.
Mirion (NYSE:MIR)
With its technology protecting workers in over 130 countries and equipment used in 80% of cancer centers worldwide, Mirion Technologies (NYSE:MIR) provides radiation detection, measurement, and monitoring solutions for medical, nuclear energy, defense, and scientific research applications.
Mirion reported revenues of $202 million, up 4.9% year on year. This number beat analysts’ expectations by 0.6%. Overall, it was an exceptional quarter as it also put up an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.
The stock is up 27.8% since reporting and currently trades at $19.90.
Read our full, actionable report on Mirion here, it’s free.
Crane NXT (NYSE:CXT)
Born from a corporate transformation completed in 2023, Crane NXT (NYSE:CXT) provides specialized technology solutions for payment processing, banknote security, and authentication systems for financial institutions and businesses.
Crane NXT reported revenues of $330.3 million, up 5.3% year on year. This print surpassed analysts’ expectations by 3.9%. It was a very strong quarter as it also recorded an impressive beat of analysts’ organic revenue estimates and a decent beat of analysts’ EPS estimates.
Crane NXT pulled off the biggest analyst estimates beat among its peers. The stock is up 14.3% since reporting and currently trades at $54.47.
Read our full, actionable report on Crane NXT here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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