Ignore the Doubters -- This Growth Stock Still Has a Bright Future
Investors in machine vision company Cognex (NASDAQ: CGNX) were dealt a blow following the release of the company's first-quarter earnings. The stock fell sharply afterward and is now down a whopping 38%. While there are good reasons for a realignment in the valuation following adverse events this year, it seems unlikely that anything has happened to reduce the company's long-term earnings potential by nearly 40%. So does that mean Cognex is a good value stock right now? Let's take a look.
Recapping the key events from the first-quarter earnings, it wasn't so much that the earnings were terrible in themselves. Instead, the market took umbrage with management's guidance for the second quarter and commentary on trading conditions in 2022. The second-quarter guidance for revenue of $265 million to $285 million came in lower than the market's previous estimate of $293 million. In addition, the guidance for gross margin in the low 70% range is below the company's target of mid-70%.
Source Fool.com
