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Valued at a market cap of $18.3 billion, Trimble Inc. (TRMB) provides technology solutions that enable professionals and field mobile workers to enhance or transform their work processes. The Westminster, Colorado-based company leverages Global Positioning Systems, Global Navigation Satellite Systems, augmentation systems, and other systems based on optical and laser technologies in order to provide real-time position.
Shares of this tech company have significantly outpaced the broader market over the past 52 weeks. Trimble has soared 41.6% over this time frame, while the broader S&P 500 Index ($SPX) has gained 20.7%. On a YTD basis, the stock is up 5.2%, compared to SPX’s 3.1% rise.
Narrowing the focus, Trimble also outshined the Technology Select Sector SPDR Fund’s (XLK) 13.7% return over the past 52 weeks and 1.6% gain on a YTD basis.
On Nov. 6, shares of Trimble skyrocketed 17.9% after its Q3 earnings release as the company delivered stronger-than-expected Q3 adjusted EPS of $0.70 and revenues of $875.8 million. The bottom-line figure increased 2.9% year-over-year. However, the top line declined by 8.5% from the year-ago quarter. A decline in field systems segment revenues overshadowed the growth in other segments and resulted in a revenue fall. Nonetheless, TRMB’s top line advanced 3% on an organic basis, and annualized recurring revenues (ARR) increased by a notable 13% year-over-year and reached $2.2 billion.
Moreover, the company raised its fiscal 2024 guidance, reflecting confidence in its strategic direction and financial health. It now expects adjusted EPS between $2.79 to $2.87 and revenues between $3.63 billion and $3.67 billion, which might have further bolstered investor confidence.
For fiscal 2024, which ended in December, analysts expect Trimble’s EPS to grow 6.4% year over year to $2.34. The company’s earnings surprise history is promising. It surpassed the Wall Street estimates in each of the last four quarters.
Among the 11 analysts covering the stock, the consensus rating is a “Strong Buy,” which is based on nine “Strong Buy,” one “Moderate Buy,” and one “Hold” rating.
This configuration is significantly more bullish than three months ago, with seven analysts suggesting a “Strong Buy” rating.
On Dec. 12, Oppenheimer analyst Kristen Owen maintained an “Outperform” rating on TRMB and raised its price target to $88, which indicates an 18.3% potential upside from the current levels.
The mean price target of $87.05 represents a 17.1% upside from Trimble’s current price levels, while the Street-high price target of $92 suggests an upside potential of 23.7%.
