Is It Time To Consider Buying Zebra Technologies Corporation (NASDAQ:ZBRA)?

By
Simply Wall St
Published
January 25, 2022
NasdaqGS:ZBRA
Source: Shutterstock

Let's talk about the popular Zebra Technologies Corporation (NASDAQ:ZBRA). The company's shares saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$615 and falling to the lows of US$491. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Zebra Technologies' current trading price of US$491 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Zebra Technologies’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Zebra Technologies

Is Zebra Technologies still cheap?

According to my valuation model, Zebra Technologies seems to be fairly priced at around 11.92% above my intrinsic value, which means if you buy Zebra Technologies today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $438.30, then there isn’t really any room for the share price grow beyond what it’s currently trading. Is there another opportunity to buy low in the future? Since Zebra Technologies’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of Zebra Technologies look like?

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NasdaqGS:ZBRA Earnings and Revenue Growth January 25th 2022

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Zebra Technologies' earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has already priced in ZBRA’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on ZBRA, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example, we've discovered 2 warning signs that you should run your eye over to get a better picture of Zebra Technologies.

If you are no longer interested in Zebra Technologies, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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