Symbotic (NASDAQ:SYM) is an AI-driven warehouse automation company that has delivered solid gains through the first half of 2023. However, the stock has been slumbering since then and has gone down nearly 34% in the past year. SYM stock is down 16% in the past 24 hours alone. Is it finally time to buy the stock? Here’s what you need to know:
SYM stock fell significantly after it reported a Q1 net loss of $19 million despite reporting 35% year-over-year revenue growth to $487 million. Analysts expected $490.98 million in revenue. Adjusted EBITDA did improve to $18 million, but the company’s Q2 guidance disappointed analysts. It also reported -$0.03 in EPS, which missed the $0.02 consensus.
Symbotic sees $510 million to $530 million in revenue and $26 million to $30 million in EBITDA in Q2. The guidance fell short of analyst estimates as they expected $535.78 million in revenue.
Symbotic’s cash reserves are now at $903 million.
You should keep in mind that Symbotic operates in a $30 billion warehouse automation market. This market is expected to grow at a 15% to 16.2% CAGR through 2030 to over $63 billion. The next wave of AI hype will likely hit the industrial sector if it hasn’t done so already because Symbotic has a $22.4 billion backlog of committed orders.
Industrial AI is also likely to bring in higher margins for companies. The recent miss was big, but not big enough to throw the company off track completely. It is still delivering solid growth and is one of the only AI companies with positive EBITDA. In fact, analysts expect 130.5% EPS growth next year, which means you’re paying about 47 times fiscal 2026 earnings.
For an AI stock growing sales at 30%+, that’s more than reasonable.
Cantor Fitzgerald analyst Derek Soderberg sees the stock going to $60 in the next year. This implies roughly 131% upside potential. The consensus price target of $38.33 implies 47% upside from here.
