Faro Technologies (FARO) AI Stock Analysis

• Market Cap: $848.40M
• Dividend Yield: N/A
• Average Volume (3M): 695.26K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.13
• Revenue Growth: -4.76%
• EPS Growth: 97.93%
• Country: US
• Employees: 1,181
• Sector: Technology
• Sector Strength: 87
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 0.33
• Shares Outstanding: 19,316,887
• 10 Day Avg. Volume: 722,681
• 30 Day Avg. Volume: 695,258
• PEG Ratio: 0.60
• Price to Book (P/B): 1.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -12.89
• Enterprise Value/Market Cap: 0.61
• Enterprise Value/Revenue: 0.38
• Enterprise Value/Gross Profit: 2.73
• Enterprise Value/Ebitda: 14.42
• 1Y Price Target: $44.00
• Price Target Upside: 0.18% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

• Rating: 62 Neutral
• Price Target: $47.00 ▲(7.01%Upside)

FARO Technologies' overall stock score is driven by strong earnings call performance and positive technical analysis, indicating bullish momentum. However, financial performance and valuation concerns, along with legal challenges from the merger, weigh down the score.

Positive Factors

Acquisition

FARO shares rose 35% on the news of the acquisition agreement.

Growth Strategy

FARO is taking important steps to drive growth, including securing two new OEM/distribution agreements and new product introductions.

Management

The company's financial performance has improved meaningfully since Peter Lau joined as CEO.

Negative Factors

Analyst Rating

Analyst believes shares are fairly priced, leading to a lowered rating to Hold from Buy.

Market Conditions

FARO has faced the same top-line challenges affecting other industrial technology companies with the weak global PMI data.

Revenue Guidance

FARO’s Q2 guide for revenues -- down 4% to +6% year-over-year vs. consensus +1% -- appears to adequately reflect the challenging macro, with particular conservatism built into hardware sales in Q2.

Faro Technologies Business Overview & Revenue Model

Company Description

FARO Technologies, Inc. designs, develops, manufactures, markets, and supports software driven three-dimensional measurement, imaging, and realization solutions in North America, South America, Europe, the Middle East, Africa, and the Asia-Pacific. The company offers FaroArm, a combination of a portable articulated measurement arm, a computer, and CAM2 software programs; FARO Laser Tracker, a combination of a portable large-volume laser measurement tool, a computer, and CAM2 software programs; FARO Laser Projector, which provides a virtual template that operators and assemblers can use to quickly and accurate position components; and FARO Laser Scanning Portfolio to measure and collect a cloud of data points. It also provides FARO ScanPlan, a handheld mapper that captures two-dimensional floor plans; and FARO Software, a software solution that integrate with FARO hardware products to merge data and provide collaborative workflows and applications. The company offers its products for metrology, reverse engineering, factory automation, building information modeling, public safety, and other applications. FARO Technologies, Inc. was founded in 1981 and is headquartered in Lake Mary, Florida.

How the Company Makes Money

FARO Technologies makes money through the sale of its 3D measurement and imaging devices, associated software, and related services. Key revenue streams include the direct sale of hardware products like laser scanners and coordinate measuring machines, which are often used in industries such as automotive, aerospace, and architecture. Additionally, the company generates recurring revenue from software licensing and subscription fees for its proprietary software solutions that complement its hardware offerings. FARO also earns income from maintenance contracts, training, and support services, which provide ongoing customer engagement and support. Strategic partnerships with technology and industry leaders help expand FARO's market reach and enhance its product offerings, further contributing to its revenue generation.

Faro Technologies Financial Statement Overview

Summary

Faro Technologies is facing challenges with declining revenue and consistent net losses. While there are improvements in operational efficiency and cash flow generation, the overall financial performance remains weak due to negative profitability and a declining free cash flow growth rate.

Income Statement

Faro Technologies has faced declining revenue over recent periods, with a notable decrease from $358.8M in 2023 to $341M in TTM (Trailing-Twelve-Months) 2025. The net profit margin remains negative as the company reported a net loss. The EBIT and EBITDA margins have shown slight improvement in recent periods, indicating some operational efficiency gains.

Balance Sheet

The balance sheet shows a reasonable debt-to-equity ratio, indicating moderate leverage. The company's stockholders' equity is healthy, comprising a significant portion of total assets, which suggests financial stability. However, the return on equity remains negative due to continued losses, impacting overall shareholder value.

Cash Flow

Cash flow analysis reveals positive operating cash flow and free cash flow in TTM 2025, reflecting an improvement in cash generation capabilities. However, the free cash flow growth rate is negative compared to prior periods, and the operating cash flow to net income ratio is high due to net losses, indicating reliance on non-operating sources for cash generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	341.05M	342.43M	358.83M	345.76M	337.81M	303.77M
Gross Profit	191.08M	187.15M	165.00M	175.76M	183.93M	159.85M
EBITDA	28.20M	18.35M	-35.23M	-7.55M	5.18M	-16.23M
Net Income	-893.00K	-9.07M	-56.58M	-26.76M	-39.96M	629.00K
Balance Sheet
Total Assets	495.03M	483.00M	504.69M	473.35M	479.74M	525.59M
Cash, Cash Equivalents and Short-Term Investments	102.63M	98.70M	96.28M	37.81M	121.99M	185.63M
Total Debt	92.06M	88.80M	89.03M	20.36M	24.39M	27.97M
Total Liabilities	234.86M	233.40M	236.09M	162.30M	153.28M	165.29M
Stockholders Equity	260.17M	249.61M	268.61M	311.05M	326.46M	360.30M
Cash Flow
Free Cash Flow	22.13M	24.79M	-12.92M	-41.79M	-25.42M	15.32M
Operating Cash Flow	29.09M	30.63M	1.07M	-24.86M	-13.48M	21.39M
Investing Cash Flow	-3.22M	-3.19M	-33.49M	-49.90M	-45.74M	13.91M
Financing Cash Flow	-12.83M	-12.85M	71.28M	-997.00K	1.58M	11.06M

Faro Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.92
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FARO, the sentiment is Positive. The current price of 43.92 is above the 20-day moving average (MA) of 43.37, above the 50-day MA of 40.50, and above the 200-day MA of 29.14, indicating a bullish trend. The MACD of 0.99 indicates Positive momentum. The RSI at 80.53 is Negative, neither overbought nor oversold. The STOCH value of 64.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FARO.

Faro Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LYTS	75 Outperform	$535.58M	24.98	10.42%	1.14%	17.89%	-23.37%
ALNT	74 Outperform	$656.16M	65.57	3.64%	0.32%	-10.99%	-61.37%
Sector *	63 Neutral	$34.04B	6.14	-11.52%	1.82%	5.53%	-18.79%
FARO	62 Neutral	$848.40M	―	-0.34%	―	-4.76%	97.93%
OUST	62 Neutral	$1.22B	―	-56.81%	―	28.04%	64.81%
MVIS	50 Neutral	$284.16M	―	-135.21%	―	-41.76%	5.56%
KULR	49 Neutral	$262.09M	―	-67.89%	―	16.47%	27.22%

Faro Technologies Corporate Events

FARO Technologies Faces Shareholder Litigation Over Merger

On May 5, 2025, FARO Technologies entered into a merger agreement with AMETEK, Inc., where FARO will become a wholly-owned subsidiary of AMETEK. Following the merger announcement, FARO faced litigation from shareholders alleging insufficient disclosures in the proxy statement related to the merger. To mitigate potential delays and costs associated with these legal challenges, FARO has voluntarily amended its proxy statement, although it maintains that the original disclosures were compliant with all applicable laws. The merger has received antitrust clearances from several jurisdictions, with approval still pending in Romania.

The most recent analyst rating on (FARO) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on Faro Technologies stock, see the FARO Stock Forecast page.

FARO Technologies Holds Annual Shareholder Meeting

On May 21, 2025, FARO Technologies held its Annual Meeting of Shareholders, where four key proposals were voted on. The shareholders elected directors Moonhie Chin and Yuval Wasserman for three-year terms, ratified Grant Thornton LLP as the independent registered public accounting firm for 2025, approved executive compensation on a non-binding basis, and amended the 2022 Equity Incentive Plan to increase shares reserved for issuance by 1.5 million. These decisions reflect strategic moves to strengthen corporate governance and align executive incentives with shareholder interests.

The most recent analyst rating on (FARO) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on Faro Technologies stock, see the FARO Stock Forecast page.

FARO Technologies Announces Merger with AMETEK

On May 5, 2025, FARO Technologies entered into a merger agreement with AMETEK, Inc., where FARO will become a wholly-owned subsidiary of AMETEK. The merger, expected to close in the second half of 2025, involves a cash consideration of $44.00 per share for FARO’s shareholders. The agreement includes several conditions, such as shareholder approval and regulatory clearances, and outlines the treatment of FARO’s stock options and restricted stock units. The merger aims to enhance FARO’s market positioning and operational efficiency, with potential implications for its stakeholders, including changes in stock listing and corporate structure.

FARO Technologies Announces Merger with Ametek

On May 5, 2025, FARO Technologies announced a merger agreement with Ametek, Inc., where Ametek will acquire all outstanding shares of FARO for $44 per share, valuing the transaction at approximately $920 million. This acquisition, approved by both companies’ boards, is expected to enhance Ametek’s presence in growth markets and is anticipated to close in the second half of 2025, pending customary conditions and shareholder approval.