Latest news with #CGNX
Yahoo
5 days ago
- Business
- Yahoo
1 Incredible Reason to Buy This Growth Stock Before Interest Rates Drop
Key Points This company is adding to the value of its offerings by infusing them with artificial intelligence. After a difficult period, the company's growth looks set to take off again in 2026. 10 stocks we like better than Cognex › Investors often talk about growth stocks in terms of their cyclical growth (tied to the economy) and secular growth (benefiting from a structural and fundamental change in an industry). The distinction is beneficial to understand when looking at machine vision company Cognex (NASDAQ: CGNX). Cognex has a big future It's no secret that the increasing adoption of technologies like automation and machine vision is the key to modern manufacturing, particularly in reshoring it from countries with lower labor costs. In addition, machine vision's ability to perform repetitive tasks in assembly lines and logistics -- guiding, monitoring, inspecting, and controlling processes more effectively than the human eye -- is a significant plus. Also, consider the potential of deep learning through artificial intelligence (AI). For example, Cognex's software can learn from "right " and "wrong" examples given to it, enabling the hardware to identify anomalies in production. As such, Cognex is also a way to play the AI evolution, as it will significantly enhance the value-add of its solutions. Cognex and interest rates All of the above is an example of secular growth. However, like almost all companies, Cognex also relies on cyclical growth. Furthermore, its exposure to capital spending in interest-rate-sensitive areas, like automotives (notably electric vehicle batteries) and consumer electronics (Apple has been a significant customer in the past), leaves it exposed to the ups and downs of the economy. When the economy is booming, auto and electronics companies are willing to make expansionary capital spending decisions, and when it's weak, cutting capital spending is often the first thing companies look to do. Unfortunately, the relatively high interest rates have hit Cognex's overall growth prospects, even as it grows its AI solutions by embedding more AI/deep learning into its solutions. If and when interest rates do move lower, there's likely to be some spending due from automakers and electronics companies as end demand at least stabilizes, and they need to invest in new product development. That will benefit Cognex. All told, the combination of secular and cyclical growth makes Cognex an excellent stock to buy ahead of a rate cut. Do the experts think Cognex is a buy right now? The Motley Fool's expert analyst team, drawing on years of investing experience and deep analysis of thousands of stocks, leverages our proprietary Moneyball AI investing database to uncover top opportunities. They've just revealed their to buy now — did Cognex make the list? When our Stock Advisor analyst team has a stock recommendation, it can pay to listen. After all, Stock Advisor's total average return is up 1,047% vs. just 181% for the S&P — that is beating the market by 865.26%!* Imagine if you were a Stock Advisor member when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $635,544!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,099,758!* The 10 stocks that made the cut could produce monster returns in the coming years. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Cognex. The Motley Fool has a disclosure policy. 1 Incredible Reason to Buy This Growth Stock Before Interest Rates Drop was originally published by The Motley Fool Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten
Yahoo
01-08-2025
- Business
- Yahoo
Cognex (CGNX) Bounces Back 20.7% as Earnings, Outlook Impress
We recently published . Cognex Corporation (NASDAQ:CGNX) is one of the best-performing stocks on Thursday. Cognex Corp. rebounded by 20.76 percent on Thursday to finish at $40.77 apiece after reporting impressive earnings in the past quarter and raising its growth outlook for the third quarter of the year. In its financial statement, Cognex Corporation (NASDAQ:CGNX) said net income in the second quarter increased by 12 percent to $40.5 million from $36.2 million in the same period last year, while revenues grew by 4 percent to $249 million from $239 million year-on-year. Copyright: franckito / 123RF Stock Photo Net profit in the first half rose by 33 percent to $64 million from $48 million, while revenues inched up by 3 percent to $465 million from $450 million. For the current quarter, Cognex Corporation (NASDAQ:CGNX) said it targets to grow its revenues by 9 percent to a range of $245 million to $265 million, versus the $235 million actual revenue in the same period last year. Adjusted EPS was also pegged at $0.24 to $0.29, or 35 percent higher year-on-year. Meanwhile, Cognex Corporation (NASDAQ:CGNX) is also set to distribute a quarterly cash dividend worth $0.08 to shareholders as of August 14 record. The dividends will be payable on August 28, 2025. While we acknowledge the potential of CGNX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-05-2025
- Business
- Yahoo
Cognex Corporation's (NASDAQ:CGNX) Intrinsic Value Is Potentially 39% Above Its Share Price
Using the 2 Stage Free Cash Flow to Equity, Cognex fair value estimate is US$41.30 Cognex's US$29.72 share price signals that it might be 28% undervalued Analyst price target for CGNX is US$37.12 which is 10% below our fair value estimate How far off is Cognex Corporation (NASDAQ:CGNX) from its intrinsic value? Using the most recent financial data, we'll take a look at whether the stock is fairly priced by estimating the company's future cash flows and discounting them to their present value. This will be done using the Discounted Cash Flow (DCF) model. There's really not all that much to it, even though it might appear quite complex. Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. For those who are keen learners of equity analysis, the Simply Wall St analysis model here may be something of interest to you. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we discount the value of these future cash flows to their estimated value in today's dollars: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF ($, Millions) US$178.0m US$210.0m US$252.6m US$295.0m US$327.0m US$354.7m US$378.8m US$400.2m US$419.6m US$437.5m Growth Rate Estimate Source Analyst x10 Analyst x10 Analyst x3 Analyst x1 Est @ 10.84% Est @ 8.47% Est @ 6.81% Est @ 5.65% Est @ 4.84% Est @ 4.27% Present Value ($, Millions) Discounted @ 7.5% US$166 US$182 US$203 US$221 US$228 US$230 US$229 US$225 US$219 US$213 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$2.1b The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (2.9%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 7.5%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$438m× (1 + 2.9%) ÷ (7.5%– 2.9%) = US$9.9b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$9.9b÷ ( 1 + 7.5%)10= US$4.8b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is US$6.9b. The last step is to then divide the equity value by the number of shares outstanding. Compared to the current share price of US$29.7, the company appears a touch undervalued at a 28% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out. Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Cognex as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.5%, which is based on a levered beta of 1.049. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. See our latest analysis for Cognex Strength Earnings growth over the past year exceeded the industry. Currently debt free. Dividends are covered by earnings and cash flows. Weakness Dividend is low compared to the top 25% of dividend payers in the Electronic market. Opportunity Annual earnings are forecast to grow faster than the American market. Trading below our estimate of fair value by more than 20%. Threat Annual revenue is forecast to grow slower than the American market. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn't be the only metric you look at when researching a company. DCF models are not the be-all and end-all of investment valuation. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. For instance, if the terminal value growth rate is adjusted slightly, it can dramatically alter the overall result. Why is the intrinsic value higher than the current share price? For Cognex, we've put together three pertinent aspects you should look at: Financial Health: Does CGNX have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk. Future Earnings: How does CGNX's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NASDAQGS every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
14-05-2025
- Business
- Yahoo
CGNX Q1 Earnings Call: CEO Succession and Focus on AI-Driven Growth Amid Mixed Market Signals
Machine vision technology company Cognex (NASDAQ:CGNX) reported revenue ahead of Wall Street's expectations in Q1 CY2025, with sales up 2.5% year on year to $216 million. On the other hand, next quarter's revenue guidance of $245 million was less impressive, coming in 0.6% below analysts' estimates. Its non-GAAP profit of $0.16 per share was 19.4% above analysts' consensus estimates. Is now the time to buy CGNX? Find out in our full research report (it's free). Revenue: $216 million vs analyst estimates of $212 million (2.5% year-on-year growth, 1.9% beat) Adjusted EPS: $0.16 vs analyst estimates of $0.13 (19.4% beat) Adjusted EBITDA: $36.29 million vs analyst estimates of $28.37 million (16.8% margin, 27.9% beat) Revenue Guidance for Q2 CY2025 is $245 million at the midpoint, below analyst estimates of $246.5 million Operating Margin: 12.1%, up from 6.7% in the same quarter last year Free Cash Flow Margin: 17.6%, up from 4.5% in the same quarter last year Market Capitalization: $5.31 billion Cognex's first quarter results were shaped by ongoing investments in product innovation and sales force expansion, as well as solid demand from the logistics and semiconductor sectors. Management highlighted the recent launch of the In-Sight 8900 smart camera, integrating AI for manufacturing automation, and continued progress in reaching new customers through an expanded sales team. CEO Rob Willett attributed margin expansion to disciplined cost management and improved operating leverage, noting, "Our focus on profitability is yielding strong results with an almost 500 basis point year-on-year increase in adjusted EBITDA margin." Looking forward, Cognex outlined a cautious stance for the next quarter, citing persistent macroeconomic uncertainty, evolving trade policy, and specific industry headwinds in automotive and consumer electronics. President and incoming CEO Matt Moschner indicated the company will continue to prioritize AI technology leadership and customer experience, while acknowledging that tariff-related risks and geographic shifts in manufacturing could impact demand patterns. "We will concentrate on three key goals that will generate long-term shareholder value," Moschner stated, emphasizing Cognex's intent to adapt to ongoing changes in the industrial automation landscape. Cognex's management emphasized a combination of leadership transition, product innovation, and evolving end-market dynamics as key influences on Q1 performance and future strategy. CEO transition announced: Rob Willett will retire, and President/COO Matt Moschner will become CEO in June, following a multi-year succession plan involving operational leadership and integration of major acquisitions. AI-powered product launches: The new In-Sight 8900 smart camera, featuring embedded artificial intelligence, was launched to address complex automation challenges for original equipment manufacturers (OEMs), positioning Cognex to expand in electronics and packaging. Sales force transformation: Management continued to invest in expanding and restructuring its sales team, targeting broader market reach, particularly in packaging, healthcare, and emerging industries. The company reported adding 3,000 new customers last year through these efforts. Segment performance trends: Logistics delivered its fifth consecutive quarter of double-digit growth, fueled by ongoing e-commerce investment. Semiconductor demand was strong but faces uncertainty due to tariffs. Meanwhile, automotive revenue declined, and consumer electronics experienced timing-related weakness. Margin and cost management: Adjusted operating expenses declined due to lower headcount and cost discipline, supported by favorable foreign exchange movements. Management stressed ongoing focus on leveraging operating expenses to support profitable growth, particularly as the business mixes shift toward faster-growing but lower-margin segments like logistics. Management's outlook centers on expanding AI-driven product capabilities and sales reach, while navigating ongoing macroeconomic and geopolitical uncertainty, particularly in automotive and semiconductor markets. AI leadership and product expansion: Cognex aims to become the leading provider of AI-enabled machine vision systems, incorporating more AI features into upcoming product lines to address automation needs in diverse industries. Supply chain and tariff risks: The company expects to substantially mitigate current tariff impacts, but acknowledges the risk of further trade policy changes. Global supply chain recalibration and reshoring trends may create long-term opportunities, yet could also delay customer purchasing decisions in the near term. Sales force and market diversification: Efforts to broaden the customer base—especially in packaging, healthcare, and emerging verticals—are expected to reduce cyclicality and support more stable growth, even as traditional sectors like automotive remain pressured. Joe Giordano (TD Cowen): Questioned whether the decline in operating expenses was sustainable or driven by one-time effects. Management cited FX benefits and sales force restructuring, but emphasized ongoing cost discipline for long-term margin leverage. Damian Karas (UBS): Asked about the outlook for consumer electronics given production shifts out of China. Management expects modest growth, with increased automation in new manufacturing locations presenting a potential opportunity for Cognex. Tommy Moll (Stephens Inc.): Sought details on logistics growth and its drivers. Management stated that growth is currently led by large e-commerce customers, with increasing demand for automation in existing distribution centers rather than new facility construction. Andrew Buscaglia (BNP Paribas): Probed whether customer hesitancy or delayed orders were emerging amid macro uncertainty, especially in automotive. Management noted no material changes in order patterns, but described the situation as fluid and highlighted volatility in auto. Kevin Wilson (Truist Securities): Inquired about penetration in packaging and healthcare, and the impact of the emerging customer salesforce initiative. Management described these markets as broad and less cyclical, with the expanded sales team already generating significant new customer additions. In upcoming quarters, the StockStory team will monitor (1) Cognex's progress in integrating AI features across its product portfolio and gaining share in logistics and packaging, (2) the effectiveness of its sales force expansion in driving new customer acquisition and diversifying end-market exposure, and (3) the company's ability to navigate tariff changes and supply chain shifts without significant margin erosion. The June Investor Day and updates on the CEO transition will also serve as important markers for future direction. Cognex currently trades at a forward P/E ratio of 35.5×. Is the company at an inflection point that warrants a buy or sell? Find out in our free research report. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today. 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Yahoo
14-05-2025
- Business
- Yahoo
3 Stocks Under $50 Facing Headwinds
Stocks trading between $10 and $50 can be particularly interesting as they frequently represent businesses that have survived their early challenges. However, investors should remain vigilant as some may still have unproven business models, leaving them vulnerable to the ebbs and flows of the broader market. Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. Keeping that in mind, here are three stocks under $50 to swipe left on and some alternatives you should look into instead. Share Price: $42.05 A global distributor of vehicle parts and accessories, LKQ (NASDAQ:LKQ) offers its customers a comprehensive selection of high-quality, affordably priced automobile products. Why Do We Think LKQ Will Underperform? Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion Estimated sales growth of 2% for the next 12 months implies demand will slow from its two-year trend Waning returns on capital from an already weak starting point displays the inefficacy of management's past and current investment decisions LKQ's stock price of $42.05 implies a valuation ratio of 11.5x forward P/E. If you're considering LKQ for your portfolio, see our FREE research report to learn more. Share Price: $21.89 Becoming the first private company in the Southern Hemisphere to reach space, Rocket Lab (NASDAQ:RKLB) offers rockets designed for launching small satellites. Why Are We Cautious About RKLB? Issuance of new shares over the last two years caused its earnings per share to fall by 24.4% annually while its revenue grew Cash burn makes us question whether it can achieve sustainable long-term growth Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders Rocket Lab is trading at $21.89 per share, or 17.7x forward price-to-sales. Read our free research report to see why you should think twice about including RKLB in your portfolio, it's free. Share Price: $32.09 Founded in 1981 when computer vision was in its infancy, Cognex (NASDAQ:CGNX) develops machine vision systems and software that help manufacturers and logistics companies automate quality inspection and tracking of products. Why Do We Steer Clear of CGNX? Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 12.2 percentage points Waning returns on capital from an already weak starting point displays the inefficacy of management's past and current investment decisions At $32.09 per share, Cognex trades at 35x forward P/E. Check out our free in-depth research report to learn more about why CGNX doesn't pass our bar. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
