Wrapping up Q3 earnings, we look at the numbers and key takeaways for the specialized technology stocks, including Cognex (NASDAQ: CGNX) and its peers.

Companies in this sector, especially if they invest wisely, could see demand tailwinds as the world moves towards more IoT (Internet of Things), automation, and analytics. Enterprises across most industries will balk at taking these journeys solo and will enlist companies with expertise and scale in these areas. However, headwinds could include rising competition from larger technology firms, as digitization lowers barriers to entry in the space. Additionally, companies in the space will likely face evolving regulatory scrutiny over data privacy, particularly for surveillance and security technologies. This could make companies have to continually pivot and invest.

The 8 specialized technology stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.2% while next quarter’s revenue guidance was in line.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 11% since the latest earnings results.

Weakest Q3: Cognex (NASDAQ: CGNX)

Founded in 1981 when computer vision was in its infancy, Cognex (NASDAQ: CGNX) develops machine vision systems and software that help manufacturers and logistics companies automate quality inspection and tracking of products.

Cognex reported revenues of $276.9 million, up 18% year on year. This print exceeded analysts’ expectations by 5.2%. Overall, it was a satisfactory quarter for the company with a solid beat of analysts’ revenue estimates but a significant miss of analysts’ full-year EPS guidance estimates.

"I'm pleased to report Q3 was another strong quarter for Cognex," said Matt Moschner, President and CEO.

Unsurprisingly, the stock is down 24.1% since reporting and currently trades at $36.

Is now the time to buy Cognex? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Napco (NASDAQ: NSSC)

Protecting everything from schools to government facilities since 1969, Napco Security Technologies (NASDAQ: NSSC) manufactures electronic security devices, access control systems, and communication services for intrusion and fire alarm systems.

Napco reported revenues of $49.17 million, up 11.7% year on year, outperforming analysts’ expectations by 4.8%. The business had an incredible quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 5.5% since reporting. It currently trades at $41.70.

Is now the time to buy Napco? Access our full analysis of the earnings results here, it’s free for active Edge members.

Crane NXT (NYSE: CXT)

Born from a corporate transformation completed in 2023, Crane NXT (NYSE: CXT) provides specialized technology solutions for payment processing, banknote security, and authentication systems for financial institutions and businesses.

Crane NXT reported revenues of $445.1 million, up 10.3% year on year, exceeding analysts’ expectations by 3.6%. It may have had the worst quarter among its peers, but its results were still good as it also locked in an impressive beat of analysts’ organic revenue estimates and a solid beat of analysts’ revenue estimates.

As expected, the stock is down 26.7% since the results and currently trades at $47.07.

Read our full analysis of Crane NXT’s results here.

Mirion (NYSE: MIR)

With its technology protecting workers in over 130 countries and equipment used in 80% of cancer centers worldwide, Mirion Technologies (NYSE: MIR) provides radiation detection, measurement, and monitoring solutions for medical, nuclear energy, defense, and scientific research applications.

Mirion reported revenues of $223.1 million, up 7.9% year on year. This print met analysts’ expectations. It was an exceptional quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ full-year EPS guidance estimates.

The stock is down 7% since reporting and currently trades at $23.42.

Read our full, actionable report on Mirion here, it’s free for active Edge members.

OSI Systems (NASDAQ: OSIS)

With security scanners deployed at airports and borders worldwide and patient monitors used in hospitals across the globe, OSI Systems (NASDAQ: OSIS) designs and manufactures specialized electronic systems for security screening, patient monitoring, and optoelectronic applications.

OSI Systems reported revenues of $384.6 million, up 11.8% year on year. This number topped analysts’ expectations by 4.9%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ revenue estimates and full-year revenue guidance slightly topping analysts’ expectations.

The stock is up 4.6% since reporting and currently trades at $255.06.

Read our full, actionable report on OSI Systems here, it’s free for active Edge members.

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