The 3 Best Robotics Stocks to Buy in July 2024

Stocks to buy

There are multiple signs that robots are already being used on a very wide scale and will soon proliferate throughout society. For example, Tesla (NASDAQ:TSLA) recently reported that it had begun successfully using two of its humanoid, artificial intelligence-powered autonomous robots in one of its factories. Moreover, Tesla CEO Elon Musk stated that robots could one day generate more revenue than automobiles. And as of June 2023, Amazon (NASDAQ:AMZN) was utilizing 750,000 robots in its warehouses and fulfillment centers, up from 350,000 in 2021.

What’s more, robots now carry out many functions in healthcare, including assistance with surgeries, supply delivery, and cleaning. According to one report, the global robotics market generated revenue of $46 billion last year and will grow at a compound annual rate of 15% over the next eight years. As a result, the sector is expected to be worth nearly $170 billion in 2032.

Here are the three best robotics stocks to buy now.

iRobot (IRBT)

Source: rafapress / Shutterstock.com

Amazon reportedly wanted to buy iRobot (NASDAQ:IRBT), which specializes in making robotic vacuum cleaners, to access the information the company’s products had gathered about the layout of consumers’ homes. According to iRobot’s founder and former CEO,  Colin Angle, the company’s operating system “can identify more objects than any other robot vacuum.” It can purportedly comprehend features of users’ homes better than the firm’s previous operating systems.

Amid opposition to the deal from regulators, Amazon eventually backed out of the transaction. The e-commerce giant likely wanted to buy iRobot to tailor its products and marketing efforts more precisely to each consumer’s home. On its own, iRobot can use its operating system to enhance the performance of other robotic devices that it can sell in the future.

“Other iRobot OS devices could have access to (the data), and through this shared understanding of the home, know how they’re supposed to operate,” Angle, who is no longer with the company, explained in 2022.

What’s more, iRobot now has a tiny price-to-sales ratio of just 0.3x, and in May, it appointed a promising new CEO, Gary Cohen. In his previous role as CEO of Qualitor Automotive, Cohen increased “sales and profits by approximately 100% through the design of proprietary wiper technologies, improved supply chain and operations, and the (launch of ) an omnichannel strategy,” iRobot reported.

iRobot’s huge potential and tiny valuation make it one of the best robotics stocks to buy.

Symbotic (SYM)

Source: T. Schneider / Shutterstock.com

As I’ve reported previously, Symbotic (NASDAQ:SYM) provides autonomous industrial robots powered by its proprietary AI software. These days, its robots are primarily used in warehouses. Among its impressive customers are Walmart (NYSE:WMT), FedEx (NYSE:FDX) and Target (NYSE:TGT).

On May 8, after Symbotic’s strong fiscal second-quarter financial report, Deutsche Bank hiked its price target on the shares to $58, well above the shares’ current level of just over $35. The bank, which kept a “buy” rating on the shares, notes that the company’s robots help its customers utilize less storage space while reducing the amount of money they spend on warehouses. Deutsche Bank believes the firm’s products can meaningfully change the logistics sector.

Also noteworthy is that the company generated free cash flow of $18 million last quarter, while its EBITDA margin, excluding certain items, was 5.3%, up from 3.5% during the previous quarter.

Intuitive Surgical (ISRG)

Source: michelmond / Shutterstock.com

A leading developer of robotic-assistance devices for surgeons, Intuitive Surgical (NASDAQ:ISRG) reported that the number of surgical procedures in which its products were used jumped 16% in the first quarter versus the same period a year earlier. Moreover, the firm now expects the metric to climb 14% to 17% for the entire year.

Also noteworthy is that, since the end of the coronavirus pandemic, Intuitive’s operating income, excluding certain items, advanced at an impressive compound annual growth rate of about 16%.

As I noted in a previous column, the new version of the company’s flagship robotic assistance system was recently approved by the Food and Drug Administration and features many improvements over the previous iteration.

Finally, Bank of America recently identified Intuitive as one of 26 “best of breed “stocks.

Intuitive’s market-leading position and strong growth make it one of the best robotic stocks to buy.

On the date of publication, Larry Ramer held a LONG position in AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

On the date of publication, the responsible editor held a LONG position in AMZN.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been SMCI, INTC, and MGM. You can reach him on Stocktwits at @larryramer.

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