During a Financial Times interview, Susan Collins, President of the Boston Federal Reserve, expressed surprise at the economy’s resilience. She noted this resilience in light of a tight labor market and robust consumer spending. This resilience has persisted despite several months of elevated borrowing costs.
Officials are currently evaluating the implications of higher borrowing costs and tightening financial conditions
Mortgage rates have risen to their highest levels in over a decade, and more interest rate hikes are on the way. Despite these precautions, the economy has been outperforming expectations.
In particular, robotics stocks have been gaining value and long-term potential. Here are three robotics stocks set to take your portfolio’s returns to space.
NVIDIA Corporation (NVDA)
NVIDIA Corporation (NASDAQ:NVDA) is a dominant supplier of GPUs and the creation of APIs and semiconductors. NVIDIA is also prominent as a leader in both the AI hardware and software industries.
NVDA stock is up by over 200% YTD, with 42 analysts predicting a 12-month median to high price of $500 to $1000.
NVIDIA is in the semiconductor and AI industries, but its main revenue source is from the semiconductor industry. As of 2022, the semiconductor market size is at $573.44 billion and is expected to grow at a CAGR of 12.2% to $1,380.79 billion by 2029.
Financials have been strong, with a 10-year revenue CAGR of 22.35%. The company’s highest growing market sector, Data Center, has a 5-year revenue CAGR of 66% and an FY22 revenue of $10.6 billion. Management indicates high operational efficiency, as seen by its levered FCF margin of 21.14% beating the sector median by 207.92%.
NVIDIA’s principal growth catalyst is AI, as industries such as healthcare, robotics, and clean energy use its chips. Recently, NVIDIA has been making many AI-based partnerships with companies such as Hewlett-Packard Enterprise, Amazon, Google, and VMware.
According to Gartner Research, the use of GPUs in data centers is projected to increase to over 15% by 2026. CEO Jensen Huang foresees continued growth for the company in the AI industry as the world shifts towards accelerated computing and generative AI.
NVIDIA GPUs, in conjunction with Mellanox networking and CUDA AI software, form the core infrastructure for generative AI. With major cloud providers adopting NVIDIA’s H100 setups and the firm’s key partnerships with enterprise IT leaders, NVDA has an eminent probability of long-term growth and success.
Investors should purchase NVDA stock due to its strong, sustained financials and future in the AI industry.
UiPath (PATH)
UiPath (NYSE:PATH) is a platform provider that produces robotic process automation (RPA) and software solutions designed for regulating automation across companies.
PATH stock is up 20% YTD, with 16 analysts having a 12-month low to high price range of $16 to $25.
The systems infrastructure software industry is forecasted to be valued at $358.72 billion in 2023. The industry is also expected to grow at an 8.93% CAGR to $358.72 billion by 2032.
UiPath has extremely strong financials with an FWD revenue growth rate of 19.03%. EPS diluted forward growth rate is 69.47%, which beats the sector median by 728.62%. A 12.94% levered FCF margin demonstrates high efficiency in generating cash flow from operations, and all of these financials illustrate UiPath’s long-term possibility of profitability and high growth.
UiPath is building up its potential with Generative AI, partnering with OpenAI and Azure to enhance its Business Automation Platform for industries such as healthcare, manufacturing, and more to take advantage.
Robotic Process Automation acts as a link to human capabilities and digital systems. It allows software robots to mimic human actions in redundant tasks. There are four main advantages: streamlined workflows, elevated employee productivity, rapid digital transformation, and unlocking human potential.
With RPA and AIs, it empowers businesses to excel. Overall, with UiPath’s modern technology, businesses can achieve the highest level of productivity by inspiring employees to prioritize creativity and discovery.
For investors that are interested in the industry of robotics, PATH stock is recommended as a ‘buy’ because of its strong financials and next-gen platform.
Symbotic Incorporated (SYM)
Symbotic Incorporated (NASDAQ:SYM) is an American robotics company that creates and operates automated warehouse AI systems in North America. SYM stock is up a staggering 205% YTD, with Yahoo! Finance reporting 12 analysts having a 12-month price average price target of $56.33. The range spans from a low of $40.00 to $70.00. All of these price targets represent upsides as SYM stock is roughly $37.00 as of this article.
The global industrial robotics industry is forecasted to grow at an 18.9% CAGR from $39 billion in 2023 to $220 billion by 2033. It is reported that the robot installations in the United States experienced a 14% growth of 41,624 units in 2022. Revenue is expected to hit $77.9 billion by 2033.
Financials for Symbotic are strong. As of June 2023, revenue of $311.84 million grew 77.63% YoY which beat analyst expectations by 19.58%. Income metrics are recovering nicely as net income of -$4.35 million grew 78.79% YoY.
Last May, Symbotic and Walmart partnered to integrate its robotics and software automation systems in all of Walmart’s distribution centers. This expansion allowed Symbotic to head the programs in 42 of Walmart’s regional distribution centers. It represents a drastic increase to its 25 distortion centers a year before this partnership.
You don’t want to miss out on SYM stock. Its partnerships with major retail giants can lead to a fast recovery and boost the stock.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
