Zebra Technologies (NASDAQ:ZBRA) is not a well-known consumer-facing brand, but it provides critical products and services to its customers that move items or make products. With its recent acquisition of a robot specialist, it's captured the attention of some investors. On a Fool Live episode recorded on July 14, Fool contributors Brian Feroldi and Brian Withers discuss why Zebra may be worth adding to your watch list.
Brian Withers: Next up is Zebra, ZBRA, best known for barcode printers and scanners. But it's expanding its scope to be more of what I'm calling a picks-and-shovels play for retailers and fulfillment facilities as it announced the acquisition of Fetch Robotics, Just earlier this month.
Fetch has a broad line of AMRs. This is the biggest thing in robotics right now. AMRs are autonomous mobile robots. Fetch focuses on the manufacturing, fulfillment and distribution operations, whether it's timely delivery of product to the manufacturing line, robots to helping with picking and fulfillment warehouses, or lifting heavy boxes or pallets to help load trucks or move products through the distribution network. Fetch is critical to these operations, helping employees get more done, faster, more effectively, and actually safer.
Zebra is going to fold [this acquisition] into Zebra's Enterprise Asset Intelligence segment. Let's break down the words, enterprise, so big organization, assets, moving things around, and intelligence, getting data about where those things go. It's going to help them create more tools to help its customers become more effective. Quote from CFO Gustafsson said, "This move will also extend our ongoing commitment to optimize the supply chain from the point of production to the point of consumption." I think investors should be excited about this move.
Brian Feroldi: This is a company I paid zero attention to, Brian. Should I? Is this an awesome company?
Brian Withers: I've just started looking at this one. This one's captured my attention recently too. I don't necessarily like companies that make products and have to sell more products every quarter. I love companies with subscription revenues. This feels a little bit like the one you talked about earlier today, Axon [Enterprise], so it's got a clear hardware segment, but it's also getting into subscription services.
Here's what it says from the 10-K, Zebra is a global leader, I talked about enterprise, asset, intelligence, solutions in automatic identification and data capturing. We design, manufacturing, sell a broad range of products and solutions, including cloud-based subscriptions that help capture and move data, including mobile computers, barcode scanners, imagers, RFID, you name it. They have a full range of services as well, including maintenance, technical support, repair.
End-users include those in retail, e-commerce, transportation, logistics manufacturing, healthcare, hospitality, warehouse, distribution, energy, utilities, government education, banking. Think about anybody that has to move something through its network, or to customers, or to patients, and Zebra can help out.
At first glance, this is a company that's leading its industry and taking advantage of the cloud, moving into products that complement its hardware with software subscriptions. They're really helpful for helping their customers who move or make things do more with less, and Zebra is a critical part of that formula.