Cognex Shares Down On Weak Revenue Outlook, But Q4 Results To View

(RTTNews) - Shares of Cognex Corp. (CGNX) dropped more than two percent in extended trading on Thursday after the machine vision products maker provided revenue guidance for the first quarter, below Street view.

The company also reported a profit for the fourth quarter that grew 26 percent from last year, reflecting improved margins and revenue growth. Both adjusted earnings per share and quarterly revenues also topped analysts' expectations.

The Natick, Massachusetts-based company reported net income of $20.44 million or $0.23 per share for the fourth quarter, higher than $16.24 million or $0.19 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $22.01 million or $0.25 per share, compared to $17.41 million or $0.20 per share in the prior-year quarter.

On average, five analysts polled by Thomson Reuters expected the company to report earnings of $0.22 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter increased 16 percent to $95.70 million, from $82.17 million in the same quarter last year, and topped five Wall Street analysts' consensus estimate of $94.67 million.

The increase in revenues was primarily attributable to a 28 percent higher revenue from the Cognex-Factory Automation to set a new quarterly record.

Operating margin expanded 100 basis points to 26 percent from last year's 25 percent, as gross margins improved 200 basis points, partially offset by a 100 basis points increase in Selling, general, and administrative expenses as a percentage of total revenues.

"We are pleased with our strong execution in 2013. Our product development and sales initiatives drove higher revenue from the factory automation market, where we set a new record for annual revenue," CEO Robert Willett said in a statement.

For fiscal 2013, the company reported net income of $73.57 million or $0.83 per share, higher than $68.10 million or $0.78 per share in the prior year. Excluding items, adjusted net income for the year was $80.71 million or $0.90 per share, compared to $73.85 million or $0.85 per share in the prior year. Revenue for the full year increased 9 percent to $353.89 million from $324.28 million in the previous year.

Analysts expected the company to report full-year 2013 earnings of $0.82 per share on annual revenues of $352.86 million.

Looking ahead to the first quarter, Cognex forecasts revenue between $88 million and $91 million, on projected gross margins in the mid-70 percent range, while Street is looking for revenues of $91.43 million.

"Our efforts really began to deliver in the second half of the year, when factory automation revenue growth was in excess of our 20% long-term target, and we reported higher operating margins than in the first half," Willett added.

CGNX closed Thursday's regular trading session at $39.91, up $0.40 or 1.01 percent on a volume of 0.81 million shares. However, the stock lost $0.97 or 2.43% in after-hours trading.