AI Empowers Robotic Stocks ROK, SYM & PATH Worth Buying
The performance of the industrial robot market has performed poorly this year. After four consecutive years of growth, market research firm Interact Analysis indicates that global warehouse automation revenue will decline slightly in 2023 compared to 2022, and this trend will continue until 2024.
However, by the end of next year, the combination of multiple favorable factors in automation technology, coupled with the empowerment of artificial intelligence (AI), will reverse the downturn in industrial automation spending, and investment opportunities in US robotic stocks will also arise.
The International Federation of Robotics expects the total number of robot installations worldwide to increase at an average annual rate of 7% until 2026, while Interact Analysis also predicts that the size of this market will increase from less than $35 billion in 2023 to over $50 billion in 2027.
In this context, investors can consider positioning themselves in the following three US robotic stocks before the arrival of 2024.
US Robotic Stock 1: Rockwell Automation
When it comes to the concepts of "automation" and "robotics" in the US stock market, the first thing that many investors think of is $Rockwell Automation(ROK)$. Despite the challenging industry environment, the company sold more than $2.5 billion in automation solutions in the fiscal fourth quarter (through September), up 20% from a year earlier.
In addition, adjusted earnings per share rose 20% year-on-year to $3.64. However, according to analysts' forecasts, Rockwell's revenue and earnings will grow only slightly in the new fiscal year.
Today, however, with AI now empowering automation, these financial projections do not fully reflect Rockwell's growth prospects. The company is undergoing a larger paradigm shift, as evidenced by its acquisition of Clearpath Robotics and its OTTO Motors brand of autonomous robots in October. Furthermore, the company released an AI-powered asset risk prediction platform in September.
US Robotic Stocks 2: Symbotic
When it comes to industrial automation, Rockwell is the leader, but when it comes to AI robots, $Symbotic Inc.(SYM)$ is the expert.
The company manufactures automated warehouse robots that specialize in meeting the storage needs of retailers. Its autonomous mobile robotic arms and automated solutions did not exist a few years ago, but it won't take long before retailers such as $Wal-Mart(WMT)$ $Target(TGT)$ and Albertsons Companies. Inc become its clients.
This disruptive technology's growth has just begun.
When assessing the prospects for robot growth over the next year, EY said that with the decline in capital expenditure and retraining costs, not only large companies, but also small and medium-sized enterprises will soon benefit from the efficiency gains brought about by robot automation.
The average price of industrial robots has halved in the past decade, from $47,000 in 2011 to $23,000 in 2022, according to Ark Invest. And the company predicts the cost will continue to fall by 50% to 60% by 2025. Symbotic will benefit from this, with sales for fiscal 2023 (ending September this year) growing nearly 100% to nearly $1.2 billion compared to fiscal 2022.
US Robotic Stocks 3: UiPath
$UiPath(PATH)$ is a software company engaged in robotic process automation, with customers from across sectors such as banking, healthcare, and government agencies. In terms of business model, the company adopts a leasing model for automation software instead of selling it, so it earns recurring revenue.
The company's annualised revenue (run rate) rose 24% year-on-year to $1.38 billion, thanks to a rise in subscription revenue to $70 million in the October quarter.
In addition, UiPath is slowly achieving GAAP profit and may even turn profitable within two years. After the release of its quarterly report last week, the stock soared and broke through the analyst average target price of $23.88.
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