Market Overview

Analyst Upgrades Zebra Technologies On Confidence In Company's Execution

Analyst Upgrades Zebra Technologies On Confidence In Company's Execution

Zebra Technologies Corp. (NASDAQ: ZBRA) reported better-than-expected earnings Nov. 7.

The Analyst

Imperial Capital's Jeff Kessler upgraded Zebra Technologies from In-Line to Outperform and increased the price target from $95 to $120.

The Thesis

The analyst said he upgraded the stock based on his expectation that Zebra Technologies is going to successfully execute its strategy as a key applied technology infrastructure company. (See Kessler's track record here.)

Zebra is one of the purest plays on applied technology in Internet of Things, Kessler said. The company is focused on improving free cash flow profile and paying down the Motorola Enterprise acquisition debt to help improve its capital structure, he said.

Macroeconomic headwinds and a slow IT spending environment have impacted Zebra's sales cycle, but the growing importance of mobile computing and scanning solutions can become a sales and margin growth driver over the next two years, Kessler said. The price target is calculated as a 12.3 times multiple of Imperial Capital's fiscal 2018 EBITDA estimate and a 15.2 times multiple of the fiscal 2018 EPS estimate.

The Price Target

The stock is trading flat Wednesday, but has gained 27.5 percent year-to-date.

Related Links:

Benzinga's Top Upgrades, Downgrades For November 29, 2017

Latest Ratings for ZBRA

Nov 2019MaintainsOutperform
Nov 2019DowngradesOverweightNeutral
Oct 2019MaintainsOutperform

View More Analyst Ratings for ZBRA
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Posted-In: imperial capital Jeff KesslerAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga


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