Zebra Technologies Earnings: Positive Results and Guidance Align With Our Long-Term View

We maintain our $320 fair value estimate for shares of narrow-moat Zebra Technologies after the firm reported good first-quarter results that aligned with our longer-term recovery thesis. Zebra also modestly raised its full-year guidance, which we feel adheres to our expectations for improving demand over the course of the next two years. We expect Zebra to claw its way back from a sharp downturn in 2023 over the course of the next two years, as customers that pushed out orders begin to spend again. We believe 2023's sales decline stemmed from customers digesting inventory after a period of overordering, and we expect sales to align more closely to real demand going forward. We see shares as fairly valued.