Looking back on internet of things stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including 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 weak Q2. As a group, revenues missed analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was 3.4% below.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data, and internet of things stocks have had a rough stretch. On average, share prices are down 5% since the latest 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 $1.73 billion, up 5.4% year on year. This print fell short of analysts’ expectations by 2.6%. Overall, it was a weak quarter for the company with a miss of analysts’ organic revenue estimates and underwhelming earnings guidance for the full year.
"Our operating performance in the second quarter was strong with outstanding core margin expansion, record operating income and EBITDA, and earnings growth ahead of our expectations," commented David A. Zapico, AMETEK Chairman and Chief Executive Officer.
Unsurprisingly, the stock is down 6.9% since reporting and currently trades at $161.48.
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Best Q2: 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 $2.05 billion, down 8.4% year on year, in line with analysts’ expectations. It performed better than its peers, but it was unfortunately a mixed quarter for the company with a decent beat of analysts’ organic revenue estimates but underwhelming earnings guidance for the full year.
The market seems content with the results as the stock is up 4.2% since reporting. It currently trades at $261.17.
Weakest Q2: 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 $696.4 million, down 8.9% year on year, falling short of analysts’ expectations by 6.7%. It was a weak quarter for the company with revenue guidance for next quarter missing analysts’ expectations and a miss of analysts’ earnings estimates.
Vontier posted the weakest performance against analyst estimates in the group. As expected, the stock is down 13.9% since the results and currently trades at $33.80.
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 $48.52 million, down 9.1% year on year, falling short of analysts’ expectations by 6%. Zooming out, it was a weak quarter for the company with a miss of analysts’ earnings estimates.
The stock is down 10.8% since reporting and currently trades at $1.48.
Emerson Electric (NYSE: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 11% year on year, falling short of analysts’ expectations by 1.3%. More broadly, it was a weak quarter for the company with a miss of analysts’ earnings estimates.
Emerson Electric pulled off the fastest revenue growth among its peers. The stock is down 4% since reporting and currently trades at $103.49.
This content was originally published on Stock Story
