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Based in Chicago, Illinois, Motorola Solutions, Inc. (MSI) is a communications equipment manufacturer. With a market cap of $70.5 billion, the company has a strong market presence in bar code scanning, wireless infrastructure gear, and government communications.
Shares of this telecommunications company have significantly outperformed the broader market over the past 52 weeks. MSI has soared 52.1% over this time frame, while the broader S&P 500 Index ($SPX) has gained 28.3%. In 2024, shares of MSI gained 34.9%, compared to SPX’s 17.6% gain on a YTD basis.
Zooming in further, MSI’s outperformance looks even more pronounced in comparison to the S&P 500 Telecom Sector SPDR’s (XTL) 27.7% gain over the past 52 weeks and 17.8% return on a YTD basis.
Motorola’s outperformance is primarily driven by investor optimism surrounding the company’s strategic mergers and acquisitions, including the acquisition of the UK-based camera maker Silent Sentinel coupled with the company’s increased investment in R&D. Moreover, the stock rose 2.9% following the release of its Q2 earnings report on Aug. 1 due to generating record-high quarterly sales and operating earnings. This performance was driven by a strong increase in revenue from its Products and Systems Integration segment, increased adoption of cloud offerings in video and command center services, and positive reception of its APX NEXT radios.
For the current fiscal year, ending in December, analysts expect MIS’ EPS to grow 10.9% year over year to $12.19. The company’s earnings surprise history is promising. It beat the consensus estimates in each of the last four quarters.
Among the 11 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on seven “Strong Buy” ratings, one “Moderate Buy,” and three “Holds.”
On Aug 2, Barclays analyst Tim Long maintained an “Overweight” rating on MSI and raised the price target to $467- the street-high price target, noting the company's strong financial performance. This implies a potential upside of 10.5% from the current price levels.
The mean price target of $437.12 represents a premium of only 3.5% to MIS’ current levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
