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On Thursday, JPMorgan analyst Ann Duignan updated the firm’s outlook on Trimble Navigation (NASDAQ:TRMB), increasing the price target from $92.00 to $94.00 and maintaining an Overweight rating on the shares. The analyst cited a conservative guidance and expected quarter-over-quarter improvements in sales and earnings throughout 2025 as factors that could drive a continued re-rating of the stock. The company, currently valued at $18.6 billion, is trading near its 52-week high of $77.78, reflecting strong market confidence. According to InvestingPro analysis, the stock appears to be trading above its Fair Value, with additional insights available in the comprehensive Pro Research Report.
Trimble Navigation reported fourth-quarter earnings that were in line with expectations, with a substantial revenue beat that was partially offset by increased variable compensation and sales commissions. This resulted in a one cent earnings per share (EPS) beat at $0.89. The company’s fiscal year 2025 guidance raised expectations for operating margin, while the mid-point of the top-line guidance remained unchanged despite additional foreign exchange headwinds.
The company’s revenue increased by 5% year-over-year (17% organically) to $983 million in the quarter, surpassing the guidance range of $925-$965 million and the consensus estimate of $945 million. Annual Recurring Revenue (ARR) organically grew by 14% year-over-year to $2.258 billion. The fourth-quarter non-GAAP operating margin also saw a significant increase of approximately 450 basis points year-over-year to 28.8%. This strong performance is supported by impressive fundamentals, including a robust gross profit margin of 67.59% and a "GOOD" Financial Health Score of 2.62 according to InvestingPro, which offers 8 additional key insights about Trimble’s financial position.
For 2025, Trimble Navigation provided non-GAAP EPS guidance of $2.76-$2.98, with a mid-point of $2.87, slightly below the consensus of $2.89. Revenue is expected to decline 6-9% year-over-year with organic growth of 2-5%, leading to a forecast of $3.37-$3.47 billion, with a mid-point of $3.42 billion, compared to the consensus of $3.44 billion. The non-GAAP operating margin is projected to be between 26.2% and 27.2%. The stock has shown strong momentum with a 34.73% price return over the past six months. For deeper analysis and valuation metrics, including the company’s EV/EBITDA multiple of 26.8x, visit InvestingPro for the complete financial health assessment and expert insights.
The outlook for the first quarter of 2025 anticipates revenue to be down 14-17% year-over-year, with organic figures ranging from a 2% decrease to a 2% increase, and expected revenue between $794-$824 million. Operating margins are forecasted at 22.4-23.7%, and EPS is estimated at $0.55-$0.61. The first quarter is expected to be the weakest of the year due to a calendar shift, with the annual EPS distribution projected to be 20%/21%/26%/33% across the four quarters.
Duignan adjusted the full-year 2025 and 2026 EPS estimates to $2.87 (a 2 cent decrease from the previous estimate) and $3.41 (unchanged), respectively. The December 2025 price target of $94 is based on approximately 28 times the fiscal year one price-to-earnings ratio, which is one multiple above the current valuation but conservatively one multiple below the blended multiple using software and hardware peers.
In other recent news, Trimble Inc. reported fourth-quarter earnings and revenue that exceeded analyst expectations. The company posted adjusted earnings per share of $0.89, surpassing the consensus estimate of $0.88. Revenue for the quarter reached $983.4 million, up 5% year-over-year and 17% on an organic basis, beating the anticipated $946.62 million. Annualized recurring revenue grew by 14% year-over-year to $2.26 billion. For the first quarter of 2025, Trimble expects revenue between $794 million and $824 million, with adjusted earnings per share ranging from $0.55 to $0.61. The full-year 2025 guidance projects revenue between $3.37 billion and $3.47 billion, with adjusted earnings per share of $2.76 to $2.98. Additionally, Trimble’s Board of Directors has authorized a new $1 billion share repurchase program. This decision follows the recent completion of its Mobility business divestiture as the company continues to focus on its core business segments.
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