ZBRA: Margin Pressures From Tariffs Will Ease After 2025 For Expanding Profitability

Zebra Technologies' average analyst price target has decreased by approximately $14 to $358, as analysts express concerns about slowing organic growth and more cautious forward guidance.

Analyst Commentary

Analyst reactions to Zebra Technologies' latest performance and guidance reflect a mix of optimism and caution. Recent price target adjustments highlight both strengths and concerns in the company's outlook.

• Bullish analysts see margin pressures from tariffs as manageable. They forecast that these headwinds will ease by 2026 and be offset, supporting long-term profitability.
• The company's pricing power is viewed as a positive, with the ability to adjust prices in real time to navigate costs such as tariffs. This is seen as potentially protecting earnings.
• Some remain optimistic about segment performance, highlighting robust backlogs and potential for modest outperformance among select business groups, including Engineering and Construction.
• Recent acquisitions are considered strategically complementary and acquired at attractive valuations. These are viewed as supportive for future growth opportunities.

• Bearish analysts highlight concerns over decelerating organic growth. They note a sharp slowdown expected in the coming quarter after previously stronger results.
• Investors have reacted to cautious Q4 guidance by extrapolating a slower growth trajectory further into the future, which pressures valuation multiples.
• Mixed demand trends across end markets, outside of specific growth areas like data centers, contribute to a conservative outlook for the near and medium term.
• Uncertainty surrounding the impact of key acquisitions and ongoing macroeconomic headwinds continue to restrain sentiment and limit upward rating adjustments.

What's in the News

• Zebra Technologies repurchased 197,322 shares valued at $59.47 million, completing a buyback of 1,588,766 shares for a total of $464.34 million since 2022 (Buyback Tranche Update).
• The company issued new guidance for fourth quarter 2025, projecting sales growth between 8% and 11%, with a significant boost from recent acquisitions and currency effects (Corporate Guidance, New/Confirmed).
• Zebra and Salesforce launched Retail Cloud POS on Android at Dreamforce 2025, aiming to enhance store operations, frontline productivity, and customer experience for retailers worldwide (Strategic Alliances).
• ODW Logistics adopted Zebra Symmetry Fulfillment, expecting a 42% improvement in pick rates and increased cost efficiency in e-commerce operations (Client Announcements).
• Zebra announced a collaboration with Tulip to provide manufacturers with integrated solutions for traceability, quality management, and production tracking directly within workflows (Client Announcements).

Valuation Changes

• Consensus Analyst Price Target has declined from $372.33 to $358.47, indicating a modest reduction in fair value expectations.
• Discount Rate has risen slightly from 8.66% to 8.69%, reflecting a marginal increase in perceived risk or cost of capital.
• Revenue Growth projections have increased from 6.46% to 6.89%, suggesting improved expectations for future sales expansion.
• Net Profit Margin forecast has fallen from 14.00% to 13.43%, signaling a slight contraction in anticipated profitability.
• Future P/E ratio has decreased from 26.15x to 25.11x, pointing to somewhat lower investor valuation of future earnings.