Motorola Solutions (MSI) Valuation After Blue Eye Acquisition, Dividend Hike and Board Refresh

Motorola Solutions (MSI) just doubled down on its security and cash return story by agreeing to buy AI video monitoring firm Blue Eye, lifting its quarterly dividend by 11%, and adding Phillips 66 CEO Mark Lashier to the board.

See our latest analysis for Motorola Solutions.

Those moves come after a choppy stretch for the stock, with a roughly 21.7% 90 day share price pullback and a similar 1 year total shareholder return decline. This comes despite a strong 3 year total shareholder return of about 43%, which hints that long term momentum is still intact.

If Motorola Solutions renewed your interest in security and critical communications, it is worth scanning aerospace and defense stocks for other under the radar names shaping the same theme.

With shares now trading roughly 32% below the average analyst price target, despite steady high single digit revenue and nearly double digit earnings growth, is this pullback a genuine value entry or simply the market discounting future gains?

Most Popular Narrative Narrative: 24.9% Undervalued

With Motorola Solutions last closing at $374.39 against a narrative fair value near $498, the valuation case leans heavily on durable, compounding cash flows.

The transition toward a greater mix of software and managed/recurring services, especially in command center and video solutions, continues to drive operating leverage and net margin expansion. This shift is further supported by strong attachment rates on new hardware (e.g., APX NEXT and SVX) and growing international SaaS/cloud deployments, boosting long-term earnings growth.

Read the complete narrative.

Want to see why steady growth assumptions and a premium future earnings multiple still add up here? The narrative leans on surprisingly ambitious profitability math. Curious what those projections really look like beneath the headline fair value?

Result: Fair Value of $498.44 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this bullish setup could be upended if government budget delays drag out longer than expected or if broadband alternatives erode Motorola’s core LMR demand.

Find out about the key risks to this Motorola Solutions narrative.

Another Lens on Valuation

Step away from narrative fair value and the earnings ratio picture gets more cautious. Motorola Solutions trades at 29.5 times earnings, above its 25.5 times fair ratio, yet slightly cheaper than the US Communications industry at 32.2 times and peers at 35.8 times. Is that a safety margin or a warning that upside is already priced in?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Motorola Solutions Narrative

If you see the story differently or want to challenge these assumptions with your own numbers, build a custom view in just minutes: Do it your way.

A great starting point for your Motorola Solutions research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This 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.

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