Investors looking for the best robotics stocks to buy have a lot of things to consider.
In response to the global pandemic, supply-chain bottlenecks, trade issues, and geopolitical tensions, most U.S.-based businesses are looking to relocate production closer to their domestic facilities. The nearshoring trend is already taking off, and robotics is expected to be a critical piece of the puzzle. Hence, robotics stocks should take off in a big way in the future.
Swiss Tech Leader ABB recently revealed the results of a survey showing how more than 60% of the U.S. and European respondents are exploring reshoring and nearshoring operations to build resilience amidst global challenges.
More than 60% of the respondents also believe that robotic automation will play a key role in facilitating the shift in operations. With the world constantly evolving, companies must shift existing structures and adopt new technologies to future-proof their businesses.
American companies are now turning towards robotics and automation to find solutions for labor shortages and an aging workforce. Statistics from the International Federation of Robotics show a 28% bump in robot density per 10,000 workers in the first quarter this year on a year-over-year basis.
The rate is the highest its ever been, which makes finding the best robotics stocks to buy now critical.
An iRobot (IRBT) Roomba inside Saturn electronic store
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iRobot (NASDAQ:IRBT) has recently seen its shares take a massive beating in the stock market. A lot of it has to do with semiconductor shortages, inflationary pressures and other supply-chain bottlenecks that have crippled its top-line expansion. Nevertheless, as its CEO Colin Angle puts it, “the growth runway for robotic floor care remains fundamentally healthy.”
iRobot’s recently released second-quarter results came in at $255.4 million, a drop of 30.2% from the prior-year period. The slump was impacted by delays, order reductions, and cancellations from different retailers across core markets. The company is looking to effectively align cost structures with near-term sales to improve its bottom line.
Though the business is in trouble currently, investors must look beyond the short-term and focus on its long-term growth runway. Research suggests that the robot cleaning market is expected to grow at a whopping 22.3% from 2022 to 2030.
Intuitive Surgical (ISRG)
A sign with the Intuitive Surgical logo standing outside of a company office. ISRG stock.
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Robotic-surgery leader Intuitive Surgical (NASDAQ:ISRG) has been an incredible wealth compounder since its IPO back in 2000.
It markets and develops its flagship da Vinci robotic surgical systems, which offers a broad ecosystem of services, including monitoring tools, imaging, instruments, and other related elements to provide minimally invasive care.
Operating results appeared to be on the right track after the pandemic fade, but current economic headwinds have halted its progress. Its second-quarter results came in well behind estimates, and estimates for the third quarter aren’t looking too pretty either.
Nevertheless, its da Vinci installed base grew a healthy 13% from the second quarter of 2021. Moreover, its installed base improved by an amazing 35.4% from the second quarter of 2019. Additionally, its gross and EBITDA margins of 68% and 34%, respectively, are extraordinary.
Fanuc (FANUY)
a robotic hand reaching out to a human hand against a black background, with the pointer fingers touching
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Fanuc (OTCMKTS:FANUY) is a Japan-based industrial robotics leader with manufacturing facilities across Germany, the U.S., China, and Japan. Its products are used for various purposes, including food, automobile, and semiconductor production.
A look at its robust fundamentals shows that the company has been performing consistently over the past several years. The comapny boasts impeccable margins, with close to an 8% increase in levered free cash flow margins over the past five years.
FANUC has a diversified revenue base but generates roughly 50% of its sales from its home country and China. Both markets are estimated to be key players in the burgeoning industrial robotics space, with a recently released study claiming that the Chinese robot market to grow by 18.3% from 2020 to 2025.
Teradyne (TER)
a technician lowering an exploratory robot into the ocean at dawn
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Teradyne (NASDAQ:TER) is a worldwide leader in semiconductor testing equipment and automation solutions design and development.
It also has an innovative software stack that allows customers to maximize production capacity. Its solutions allow customers to save time, speed up testing and increase accuracy effectively. As the robotics sector continues to grow, so will the need for Teradyne’s testing equipment and services.
Last year was an incredible one for the business, with sales and non-GAAP earnings per share rising 19% and 29%, respectively. It’s well-positioned in two primary industries: industrial automation and semiconductor testing.
Specifically, the industrial automation business is firing on all cylinders, and the company expects the division to grow at a tremendous 40% annually through 2024. Hence, the demand for Teradyne’s products will likely remain impressive over the long haul.
UiPath (PATH)
The UiPath logo on a smartphone in front of a computer screen.
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UiPath (NYSE:PATH) is a robotic process automation specialist that has been a growth juggernaut in its niche.
It deploys bots that effectively automate different business processes through low-code software. So far, it’s been incredibly successful in growing its top and bottom-line results even in the most testing of times.
The ability to automate repetitive tasks without programming skills holds incredible relevance today and beyond.
It recently posted another blow-out quarterly report, despite foreign exchange headwinds. Revenues were up 24% to $242.2 million, well ahead of the consensus estimates of $230.8 million. Perhaps more importantly, annual recurring sales topped $1 billion for the first time, growing by a massive 44%.
Also, dollar-based net retention rates are up over 132%. Investors seem to be looking at its relatively weak guidance, but if they zoom out and look at the bigger picture, they’re likely to pick up UI stock at current levels.
Siemens (SIEGY)
a robot built in the essence of a human raising its hand to its chin implying deep thought
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Siemens (OTCMKTS:SIEGY) is one of the leading electronics conglomerates. Moreover, it’s one of the power, healthcare, automation, and energy suppliers.
Its business has a colossal growth runway ahead, exposing it to some of the largest secular growth opportunities, including electrification, automation, and infrastructure modernization.
Recently, the company has been planning to move into new directions, splitting its focus into two different segments and becoming a major automation play. The goal is to provide a holistic solution for customers in digitizing various manufacturing processes, covering virtually every part of the supply chain.
It plans to become a major player in the robotics niche and recently built its robot AI platform to complement its hardware offerings. Though the division doesn’t contribute much to its revenues, the scenario could change in the future.
Nvidia (NVDA)
Closeup of mobile phone screen with logo lettering of nvidia corporation on computer keyboard. NVDA stock.
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Nvidia (NASDAQ:NVDA) is one of the most diversified tech giants, with its tentacles in various profitable tech verticals.
Robotics has been of key interest to the company, considering the sector’s superb expansion during the pandemic.
Robotics has been a key focus of Nvidia’s Jetson embedded chip line. The product line is fitted with AI and machine learning software, with multiple use cases in robotics, autonomous vehicles, the manufacturing industry, and others.
Perhaps the biggest edge that Nvidia has in robotics pure-plays throughout AI and multiple related sectors. Semi-conductors are the foundation of any technology, and Nvidia is the leader in the niche. Moreover, the company has been investing in robotics startups such as Ready Robotics and Serve Robotics to improve its competencies further.
On the date of publication, Muslim Farooque 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
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.
