Symbotic’s Strong Financial Performance and Strategic Acquisition Justify Buy Rating Despite Challenges

Needham analyst James Ricchiuti maintained a Buy rating on Symbotic (SYM – Research Report) today and set a price target of $32.00.

James Ricchiuti has given his Buy rating due to a combination of factors including Symbotic’s impressive financial performance in the recent fiscal quarter. The company reported revenues that surpassed the upper range of its guidance, showing a 40% year-over-year increase, which was significantly higher than the market’s expectation of 33%. Additionally, the adjusted EBITDA also exceeded prior guidance and consensus expectations by 29%, driven by improved gross margins.
While there are challenges related to tariffs and supply chain issues, these have not been incorporated into the guidance for the next quarter. However, they seem manageable, with the potential outcome being increased revenues but slightly reduced gross margins. The acquisition of Walmart’s Advanced Systems and Robotics business earlier this year has been a substantial driver of revenue growth, contributing positively to the recent quarter’s results. Despite a temporary decline expected in the upcoming quarter, the overall outlook remains positive, justifying the Buy rating.

Ricchiuti covers the Technology sector, focusing on stocks such as Faro Technologies, Cognex, and IPG Photonics. According to TipRanks, Ricchiuti has an average return of 3.7% and a 45.55% success rate on recommended stocks.