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On Wednesday, Craig-Hallum maintained a positive stance on Xometry Inc (NASDAQ:XMTR), increasing the price target from $30.00 to $35.00 while keeping a Buy rating on the stock. Currently trading at $28.51, the stock has seen a significant 38.8% gain over the past six months, despite a recent 23.4% weekly decline. The decision came as a defense against the company’s softer first-quarter guidance, which factors in a lower gross margin and overall earnings expected to be temporary. According to InvestingPro data, the company maintains a healthy gross profit margin of 39.5%.
The analyst at Craig-Hallum, Greg Palm, expressed optimism about Xometry’s future, citing a sustainable growth rate of over 20% for the company’s marketplace. This outlook aligns with the company’s recent performance, showing 17.7% revenue growth in the last twelve months. This outlook is held despite a potentially subdued overall manufacturing environment. Palm believes that Xometry stands to gain from the current geopolitical climate, which includes heightened tariff discussions. InvestingPro analysis reveals over 10 additional key insights about Xometry’s potential, available to subscribers.
Xometry, according to Palm, could emerge as a significant beneficiary and a crucial facilitator in the transformation of manufacturing supply chains. The analyst pointed out that while current estimates do not reflect potential changes, the trend towards de-globalization, reshoring, and the implementation of tariffs could render Xometry’s platform increasingly valuable, potentially making current estimates conservative.
The analyst’s commentary underscores the belief that the challenges reflected in the first-quarter guidance are not expected to hinder the company’s long-term growth trajectory. The adjustment in the price target reflects a confidence in Xometry’s ability to capitalize on market trends and solidify its position in the industry.
In other recent news, Xometry Inc. reported its fourth-quarter 2024 financial results, surpassing earnings expectations with an earnings per share (EPS) of $0.06 compared to the forecasted $0.0267. The company’s revenue also exceeded projections, reaching $148.55 million against an expected $146.33 million. Xometry’s Q4 2024 revenue grew by 16% year-over-year, driven by strong marketplace revenue and international sales, with marketplace revenue up 20% year-over-year. Additionally, the company achieved a record marketplace gross margin of 34.5%, and active buyers increased by 23% year-over-year to 68,267.
Goldman Sachs analyst Eric Sheridan updated the firm’s stance on Xometry, raising the price target to $30.00 from $28.00 and maintaining a Buy rating. This revision follows Xometry’s strong Q4 2024 earnings report and positive forward-looking guidance for fiscal year 2025. The company anticipates continued growth with at least 20% marketplace growth per quarter in 2025 and aims for a positive adjusted EBITDA for the full year. Xometry’s management remains confident about a return to regular marketplace gross margin expansion in the second quarter and beyond.
The company’s earnings report emphasized the significant impact of artificial intelligence on its platform, which continues to disrupt the wider manufacturing supply chain. Xometry’s expansion into international markets has been particularly noteworthy, with international revenue contributing 18% to total marketplace revenue and growing by 42% year-over-year. Furthermore, Xometry is focusing on expanding its international presence and enhancing its AI capabilities to drive future growth.
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