Zebra Technologies (ZBRA) stock rallied on May 12 after the smart data capture systems company reported a market-beating Q1 and raised its guidance for the full financial year.
ZBRA generated $1.5 billion in revenue in its recently concluded quarter on per-share earnings of $4.75, indicating about a 14% year-on-year increase on the top line and an 18% pop on the bottom line.
Despite signs of a strong recovery in Q1 enterprise demand, Zebra shares remain down more than 12% versus their year-to-date high in mid-February.
Buyback Plan Makes Zebra Stock Attractive
Investors are also cheering Zebra Technologies because it raised its 2026 guidance, suggesting the post-pandemic inventory destocking cycle has finally bottomed out. Moreover, operational discipline and aggressive capital allocation are helping improve sentiment as well.
The Nasdaq-listed firm saw its gross margins improve by 80 basis points year-on-year to 50.4% in Q1, and management announced a new $300 million share repurchase plan for 2026.
Note that ZBRA stock ripped through its major moving averages (MAs) on Tuesday, with an RSI in the early 60s indicating more room to the upside before it hits overbought territory.
KeyBanc Upgrades ZBRA Shares to ‘Overweight’
The strong Q1 release also made Ken Newman, a senior KeyBanc analyst, upgrade Zebra shares to “Overweight” with a price target of $305, signaling potential upside of another 27% from here.
Newman recommends buying ZBRA due to improving short-cycle demand and the firm’s ability to navigate high memory prices through productivity initiatives.
According to Newman, Zebra Technologies full-year guidance is still conservative at best, leaving room for further “beat and raise” quarters ahead.
In his research note, Newman also cited the company’s strong free cash flow yield, seen exceeding $900 million this year, as a major driver that could move ZBRA’s valuation closer to its premium industrial-tech peers.
What’s the Consensus Rating on Zebra Technologies
Interestingly, KeyBanc is still among the more conservative Wall Street firms on ZBRA shares.
According to Barchart, the consensus rating on Zebra Technologies sits at “Moderate Buy,” with the mean price target of about $331 indicating potential for a 37% rally from here.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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