In this article, we will look at 10 best automation stocks to buy now. If you want to skip our detailed analysis of the automation industry which highlights key trends, future outlook, and major players, you can go directly to 5 Best Automation Stocks To Buy Now.
Technological advancements in deep learning, computer vision, and the internet of things, are reshaping and revolutionizing industries across the globe. Autonomous solutions for mundane and repetitive tasks are proving of benefit to businesses since they allow for reallocation and optimization of resources, which we know are never enough.
Global Automation Market Size
According to a study by Fortune Business Insights, the global industrial automation market was valued at $191.89 billion in 2021 and is expected to hit $205.86 billion by the end of 2022. The market is projected to peak at $395.09 billion by 2029 at a compound annual growth rate of 9.8%. According to Statista, the global automation market revenues came to $214.3 billion in 2021, up from $186 billion in 2019, with process automation, industrial software, and factory automation making up the majority of these revenues.
Key Trends and Major Players
The primary drivers for the above-highlighted growth of the global automation industry include the increasing adoption of 5G wireless technology, the advent of industry 4.0, and skyrocketing demand for autonomous solutions across a range of industrial sectors. Autonomous solutions are being integrated into a range of industries including oil & gas, healthcare, marketing, finance, manufacturing, and mining among others. Augmented reality and virtual reality are helping businesses restructure operations to make them more cost-effective. By creating digital twins, which are built with the help of AR and VR, businesses are mitigating overheads and gauging the feasibility of their products before beginning mass production. Moreover, manufacturers are leveraging the internet of things (IoT), cloud computing, and edge computing technologies to automate industrial processes and keep up with industry 4.0, thereby driving the global automation market.
The pioneers and innovators of automation technology, who are still making unparalleled efforts to further enhance it, include Emerson Electric Co. (NYSE:EMR), Honeywell International Inc. (NYSE:HON), and Intuitive Surgical, Inc. (NASDAQ:ISRG), among others. We have come up with our own stock selection to identify more companies that are strong-footed in the space and exhibit potential for handsome returns on investment. Continue reading the 10 best automation stocks to buy now to learn more about these stocks.
Photo by Lenny Kuhne on Unsplash
Our Methodology
To compile the 10 best automation stocks to buy now, we studied market research reports and identified companies that appeared at the top of these studies.
We also gave weight to the analyst and investor sentiment for each stock mentioned on our list. The hedge fund sentiment was determined using Insider Monkey’s database which tracks roughly 900 elite hedge funds as of the fourth quarter of 2021.
10 Best Automation Stocks To Buy Now
10. iRobot Corporation (NASDAQ:IRBT)
Number of Hedge Fund Holders: 15
iRobot Corporation (NASDAQ:IRBT) designs, builds, and sells robots and home innovation (smart home) products in the United States, Europe, the Middle East, Africa, Japan, and internationally. iRobot Corporation (NASDAQ:IRBT) is one of the 10 best automation stocks to buy now and offers a suite of autonomous home cleaning devices such as smart vacuum cleaners and smart floor moppers among others.
This February, the company reported quarterly revenues of $455.45 million for the fiscal fourth quarter of 2021. Moreover, on March 24, 2022, Northland analyst Michael Latimore upgraded iRobot Corporation (NASDAQ:IRBT) to Outperform from Market Perform with an $85 price target on the shares.
Hedge funds and analysts are equally bullish on iRobot Corporation (NASDAQ:IRBT) and according to Insider Monkey’s data, by the end of the fourth quarter of 2021, 15 hedge funds held long positions in iRobot Corporation (NASDAQ:IRBT). The total value of their stakes amounted to $25.06 million.
As of December 31, 2021, D E Shaw is the most prominent shareholder in iRobot Corporation (NASDAQ:IRBT) with stakes of more than $5.55 million, up 181% from the fund’s Q3 2021 stakes.
Like Emerson Electric Co. (NYSE:EMR), Honeywell International Inc. (NYSE:HON), and Intuitive Surgical, Inc. (NASDAQ:ISRG), iRobot Corporation (NASDAQ:IRBT) is an attractive stock option for investors looking to take up stakes in the automation industry.
9. ABB Ltd (NYSE:ABB)
Number of Hedge Fund Holders: 16
ABB Ltd (NYSE:ABB) is involved in the manufacture and sales of electrification, automation, robotics, and motion products in Switzerland and internationally. Not only is the company reporting robust earnings, but is also steadily increasing its dividends. As of May 3, 2022, ABB Ltd (NYSE:ABB) has a forward dividend yield of 2.97% and has consistently hiked its dividends for the past 3 years, which makes it a compelling stock option for investors looking to invest in the automation industry.
ABB Ltd (NYSE:ABB) recently released earnings for the fiscal first quarter of 2022, this April, in which the company beat EPS estimates by $0.05. According to the company’s report, ABB Ltd (NYSE:ABB) registered an EPS of $0.31 and generated revenues of over $6.97 billion for the quarter.
On April 22, UBS analyst Guillermo Peigneux-Lojo raised his price target on ABB Ltd (NYSE:ABB) to CHF 37 from CHF 35 and maintained a Buy rating on the shares.
Hedge funds are upping their stakes in ABB Ltd (NYSE:ABB). Insider Monkey identified 16 hedge funds long ABB Ltd (NYSE:ABB) at the close of Q4 2021. The total value of these funds’ stakes came to $892.95 million, up from $721.68 million with 19 positions in the third quarter of 2021.
Ken Fisher’s Fisher Asset Management is the dominating stakeholder in ABB Ltd (NYSE:ABB) as of the end of December 2021, owning over 18.2 million shares of the stock. This comes to a stake of $695.38 million, which covers 0.38% of Fisher Asset Management’s Q4 2021 investment portfolio.
8. Omnicell, Inc. (NASDAQ:OMCL)
Number of Hedge Fund Holders: 22
Omnicell, Inc. (NASDAQ:OMCL) is revolutionizing the healthcare industry by providing autonomous solutions for medication management and adherence tools for healthcare systems and pharmacies in the United States and internationally. On April 28, the company announced market-beating earnings for the fiscal first quarter of 2022. According to Omnicell, Inc. (NASDAQ:OMCL), the company’s revenues grew by 26.60% year over year and came to $318.83 million, beating revenue estimates by $4.85 million. Moreover, Omnicell, Inc. (NASDAQ:OMCL) reported earnings per share of $0.83 and beat expert estimates by $0.15.
This January, Omnicell, Inc. (NASDAQ:OMCL) announced its acquisition of MarkeTouch Media, a pharma-tech company, for an all-cash transaction of $82 million. With this acquisition, Omnicell, Inc. (NASDAQ:OMCL) plans to expand the footprint of its EnlivenHealthTM division across the retail pharmacy sector, while also exploring potential growth opportunities in new markets such as specialty pharmacy and pharmacy benefits management.
Omnicell, Inc. (NASDAQ:OMCL) was spotted on 22 hedge fund portfolios at the end of the fourth quarter of 2021, which held stakes worth $141.85 million in the company. This is compared to 20 positions in the previous quarter with stakes worth $110.09 million. The hedge fund sentiment for the stock is positive. As of December 31, 2021, Fisher Asset Management is the dominating shareholder in Omnicell, Inc. (NASDAQ:OMCL) with stakes worth $43.99 million in the company.
Omnicell, Inc. (NASDAQ:OMCL) is gaining recognition in the automation space for its unique approach targeted at the healthcare industry. Other prominent names in the automation industry include Emerson Electric Co. (NYSE:EMR), Honeywell International Inc. (NYSE:HON), and Intuitive Surgical, Inc. (NASDAQ:ISRG).
7. Rockwell Automation Inc. (NYSE:ROK)
Number of Hedge Fund Holders: 31
Rockwell Automation Inc. (NYSE:ROK) provides industrial automation and digital transformation solutions in the United States and internationally. The company operates through three business segments: Intelligent Devices, Software & Control, and Lifecycle Services. On April 14, Deutsche Bank analyst Nicole DeBlase lowered her price target on Rockwell Automation Inc. (NYSE:ROK) to $292 from $318 and maintained a Hold rating on the shares. DeBlase expects 11 beats and 9 misses this earnings season as companies in the industrials and equipment segment are putting forth conservative guidance.
This January, Rockwell Automation Inc. (NYSE:ROK) reported earnings for the fiscal first quarter of 2022 in which it outperformed market consensus. The company reported earnings per share of $2.14, beating EPS estimates by $0.23. The company’s quarterly revenues came to $1.86 billion, up 18.65% year over year, and beat estimates by over $35 million.
On April 6, 2022, Rockwell Automation Inc. (NYSE:ROK) announced that its board of directors have declared a quarterly cash dividend of $1.12 per share, payable on June 10 to investors of record at the close of business on May 16. Strong earnings and a handsome dividend yield are what make Rockwell Automation Inc. (NYSE:ROK) one of the best automation stocks to buy now.
Insider Monkey identified 31 hedge funds that held stakes in Rockwell Automation Inc. (NYSE:ROK) worth $700.18 million. This is compared to 29 hedge funds in the preceding quarter with stakes of $519.69 million. As of the end of last December, Impax Asset Management owns more than 690,000 shares of Rockwell Automation Inc. (NYSE:ROK) which equates to stakes of $243.02 million, making it the top shareholder in the company.
6. Azenta Inc. (NASDAQ:AZTA)
Number of Hedge Fund Holders: 33
Azenta Inc. (NASDAQ:AZTA) provides manufacturing automation solutions for the semiconductor industry, and life science services and solutions for the life sciences markets worldwide. On February 8, 2022, Azenta Inc. (NASDAQ:AZTA) announced market-beating earnings for the fiscal first quarter of 2022. The company generated revenues of $139.65 million and outperformed market consensus by $4.23 million. Moreover, the company reported earnings per share of $0.58, beating estimates by $0.69.
This March, B. Riley analyst Yuan Zhi resumed coverage of Azenta Inc. (NASDAQ:AZTA) with a Buy rating and a $106 price target. The analyst noted that Azenta Inc. (NASDAQ:AZTA) has built industry-leading capabilities of genomics, cryostorage, automation, and informatics to optimize operations for drug discovery and delivery. Azenta Inc. (NASDAQ:AZTA) ranks at number six among the best automation stocks to buy now.
At the end of the fourth quarter of 2021 33 hedge funds were long Azenta Inc. (NASDAQ:AZTA). The total value of their stakes was worth $522.37 million. This is compared to 29 positions in the previous quarter with stakes worth $577.56 million.
Ken Fisher’s Fisher Asset Management is the leading stakeholder in Azenta Inc. (NASDAQ:AZTA), having stakes worth $91.78 million as of December 31, 2021. The investment covers 0.05% of Ken Fisher’s investment portfolio.
Artisan Partners mentioned Azenta Inc. (NASDAQ:AZTA) in its fourth-quarter 2021 investor letter. Here is what the firm had to say:
“We started new investment campaign in Azenta Life Sciences. Azenta provides a broad range of products and services focused on biological sample management. The company is well positioned to benefit from the rapid rise in blood, tissue and cell samples being collected, analyzed and stored by pharmaceutical, diagnostic, medical centers and academic researchers. It provides storage systems and consumables for customers storing their own samples and also offers outsourced sample storage and analysis (which given Azenta’s scale and capabilities, can be a more efficient solution). In addition, we see an important internal change underway at the company, as it’s in the process of divesting its large legacy semiconductor business to focus entirely on life sciences. This divestiture is expected to yield $2bn in proceeds, which Azenta can use to supplement its organic growth via complementary acquisitions.”
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Disclose. None. 10 Best Automation Stocks To Buy Now is originally published on Insider Monkey.
