On Friday, Piper Sandler adjusted its outlook on Itron (NASDAQ:ITRI), a technology company providing end-to-end solutions that help utilities measure, manage, and analyze energy and water use. The firm raised its price target on the stock to $109.00, up from the previous $103.00, while maintaining an Overweight rating.
The revision follows Itron's recent earnings report, which surpassed analyst expectations with earnings per share (EPS) beating estimates by 47%. The strong performance was attributed to improved gross margins due to a favorable product mix and higher revenues.
Itron also managed to accelerate shipments of previously constrained revenues by approximately $25 million in the first quarter, with plans to ship around $40 million of the remaining constrained backlog in the second quarter.
Despite the upbeat results, the company's book-to-bill ratio, a key indicator of future revenues, was soft at 0.6 times. Still, this figure aligns with management's expectations considering the typical seasonal trends.
Itron remains optimistic about meeting its full-year 2024 bookings guidance of at least a 1:1 ratio, drawing confidence from its track record of achieving a book-to-bill ratio of around 1.0x or higher since 2017.
Itron's positive momentum in bookings is partly due to deals currently pending governmental or regulatory approval. With the company's solid performance in revenue and margins thus far, Piper Sandler anticipates a high likelihood that Itron will raise its full-year 2024 EPS guidance during the August update. The firm's stance is supported by the company's robust track record and current operational successes.
InvestingPro Insights
Following Piper Sandler's optimistic outlook on Itron, real-time data and InvestingPro Tips offer additional context for investors considering the stock. Itron's market capitalization stands at approximately $4.67 billion, reflecting its significant presence in the technology sector.
The company's P/E ratio, a measure of its current share price relative to its per-share earnings, is 26.31, with a slight increase to 28.31 when adjusted for the last twelve months as of Q1 2024. This valuation metric suggests a market that acknowledges the company's earnings growth potential.
InvestingPro Tips highlight several positive aspects of Itron's financial health and market performance. Analysts have revised their earnings upwards for the upcoming period, indicating a bullish sentiment on the company's future profitability.
Furthermore, Itron's liquid assets exceed its short-term obligations, providing financial stability. The company's moderate level of debt contributes to a solid financial structure, allowing for strategic investments and growth initiatives.
From a performance standpoint, Itron has seen a high return over the last year, with a remarkable one-year price total return of 84.78%. The stock is also trading near its 52-week high, signifying strong investor confidence and market momentum. These factors, combined with a substantial price uptick over the last six months, paint a picture of a company on an upward trajectory.
For investors seeking more in-depth analysis and additional InvestingPro Tips, there are 9 more tips available on Itron at Investing.com/pro/ITRI. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, offering a comprehensive suite of tools and insights to make informed investment decisions.
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