ZBRA
Zebra Technologies Corp
TMT, Event Driven/Special Sit
05/07/2019
Presented
| Date | 05/02/2019 |
| Price | $206.46 |
| Market Cap | $11.14B |
| Ent Value | $10.22B |
| P/E Ratio | 26.33x |
| Book Value | $27.18 |
| Div Yield | 0% |
| Shares O/S | 53.98M |
| Ave Daily Vol | 480,857 |
| Short Int | 2.93% |
Current
| Price | $375.30 |
| Market Cap | $19.36B |
| Zebra Technologies Corp. engages in designing, manufacturing and selling of automatic identification and data capture products. Its products include mobile computers, barcode scanners, radio frequency identification devices (RFID) readers, specialty printers for barcode labeling and personal identification, real-time location systems, accessories and supplies, such as self-adhesive labels and other consumables, and software utilities and applications. It also provides services such as maintenance, technical support, repair, managed and professional services, including cloud-based subscriptions. It operates through the following two segments: Asset Intelligence & Tracking (AIT) and Enterprise Visibility & Mobility (EVM). The AIT segment comprises of barcode and card printing, location solutions, supplies, and services. The EVM segment comprises of mobile computing, data capture, and RFID. The company was founded by Edward L. Kaplan and Gerhard Cless in 1969 and is headquartered in Lincolnshire, IL. |
Publicly traded companies mentioned herein: Alphabet Inc (GOOG), Honeywell International Inc (HON), Kroger Co/The (KR), Microsoft Corp (MSFT), Motorola Solutions Inc (MSI), Panasonic Corp (6752 JP), Trimble Inc (TRMB), Walmart Inc (WMT), Zebra Technologies Corp (ZBRA)
Highlights
The presenter is long shares of Zebra Technologies Corp (ZBRA), which he deems to have become the premier mobile technology solution for retail, trucking logistics, manufacturing, and recently healthcare. The company acquired Motorola’s Enterprise business in 2014 for $3.45B and has since focused on revamping its business strategy and reputation. The strategy has led to ZBRA’s strong position in the market today and the presenter’s expectation for ZBRA to take advantage of significant catalysts. As ZBRA worked towards building up its enterprise solution, management also focused on delevering; leveraged was reduced from ~5x to ~2x, which is in-line with the company’s 1.5x – 2.5x long-term target, and the stock experienced a massive run until recently. ZBRA was up ~50% YTD until the company surprised the Street by only slightly lifting full-year revenue guidance when it reported its Q1 results on April 30th; however, the presenter believes ZBRA will outperform expectations over the remainder of 2019 on the back of continued M&A activity, increased market share due to secular trends, and ZBRA’s overall competitive strength. He also expects multiple expansion as the market’s view of the company continues to shift. Considering these factors, he finds ZBRA’s risk/reward profile attractive, noting ~$300 on the upside and ~$190 on the downside.
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