Q3 Earnings Highs And Lows: SmartRent (NYSE:SMRT) Vs The Rest Of The Internet of Things Stocks

November 28, 2024 at 04:45 AM EST

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Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at SmartRent (NYSE: SMRT) and the best and worst performers in the internet of things industry.

Industrial Internet of Things (IoT) companies are buoyed by the secular trend of a more connected world. They often specialize in nascent areas such as hardware and services for factory automation, fleet tracking, or smart home technologies. Those who play their cards right can generate recurring subscription revenues by providing cloud-based software services, boosting their margins. On the other hand, if the technologies these companies have invested in don’t pan out, they may have to make costly pivots.

The 7 internet of things stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 2.9% below.

Luckily, internet of things stocks have performed well with share prices up 10.4% on average since the latest earnings results.

Weakest Q3: SmartRent (NYSE: SMRT)

Founded by an employee at a real estate rental company, SmartRent (NYSE: SMRT) provides smart home devices and software for multifamily residential properties, single-family rental homes, and student housing communities.

SmartRent reported revenues of $40.51 million, down 30.3% year on year. This print fell short of analysts’ expectations by 11.8%. Overall, it was a softer quarter for the company with a significant miss of analysts’ adjusted operating income estimates.

"In the third quarter, SmartRent demonstrated remarkable resilience and strategic focus amid a series of market headwinds and operational transitions," stated John Dorman, Chairman of the Board.

SmartRent delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Unsurprisingly, the stock is down 9% since reporting and currently trades at $1.61.

Is now the time to buy SmartRent? Access our full analysis of the earnings results here, it’s free.

Best Q3: Vontier (NYSE: VNT)

A spin-off of a spin-off, Vontier (NYSE: VNT) provides electronic products and systems to the transportation, automotive, and manufacturing sectors.

Vontier reported revenues of $750 million, down 2% year on year, outperforming analysts’ expectations by 2.8%. The business had a very strong quarter with a solid beat of analysts’ adjusted operating income estimates.

Vontier achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 14% since reporting. It currently trades at $38.84.

Is now the time to buy Vontier? Access our full analysis of the earnings results here, it’s free.

Arlo (NYSE: ARLO)

With its name deriving from the Old English word meaning “to see,” Arlo (NYSE: ARLO) provides home security products and other accessories to protect homes and businesses.

Arlo reported revenues of $137.7 million, up 5.9% year on year, exceeding analysts’ expectations by 1.1%. Still, it was a softer quarter as it posted revenue guidance for next quarter missing analysts’ expectations significantly.

The stock is flat since the results and currently trades at $12.15.

Read our full analysis of Arlo’s results here.

AMETEK (NYSE: AME)

Started from its humble beginnings in motor repair, AMETEK (NYSE: AME) manufactures electronic devices used in industries like aerospace, power, and healthcare.

AMETEK reported revenues of $1.71 billion, up 5.3% year on year. This print was in line with analysts’ expectations. Zooming out, it was a mixed quarter as it also recorded a decent beat of analysts’ adjusted operating income estimates but organic revenue in line with analysts’ estimates.

The stock is up 16.2% since reporting and currently trades at $196.31.

Read our full, actionable report on AMETEK here, it’s free.

Trimble (NASDAQ: TRMB)

Playing a role in the construction of the Paris Grand, Trimble (NASDAQ: TRMB) offers geospatial devices and technology to the agriculture, construction, transportation, and logistics industries.

Trimble reported revenues of $875.8 million, down 8.5% year on year. This print beat analysts’ expectations by 1.3%. It was a very strong quarter as it also produced a solid beat of analysts’ EBITDA estimates.

Trimble had the weakest full-year guidance update among its peers. The stock is up 17.7% since reporting and currently trades at $72.55.

Read our full, actionable report on Trimble here, it’s free.

Market Update

In response to the Fed's rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed's 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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