Impinj stock rises, growth continues

If you check baggage during the flight Delta Air Lines Inc. NYSE: FROMcan be monitored using the technology of Impinj Inc. NASDAQ:PI.

Impinj stock traded lower on February 12, gaining support above the 10-day moving average after trading higher in the previous session.

The stock began rising in mid-January and regained momentum on Feb. 9, after the company beat fourth-quarter forecasts and raised its guidance on the Impinj chart. The stock is still coming off a strong consolidation that began in April 2023 after the company issued disappointing revenue guidance.

However, with the tide appearing to be turning, Impinj is one of those lesser-known stocks that could represent a prime opportunity for investors looking for stocks with great future growth potential.

Item tracking technology across a wide range of industries

Impinj makes radio frequency identification (RFID) tags to track and locate items in various industries: retail, supply chain and logistics.

Other sectors include aviation, automotive, healthcare, industrial and manufacturing, sports, food, data centers, travel, banking, linens and uniforms.

In addition to Delta, customers include Cisco Systems Inc. NASDAQ: CSCO AND Coca-Cola Co. NYSE: KO.

Earnings came in at 9 cents a share, down 76% from the year-earlier quarter, but well above analysts’ estimates of two cents a share. Revenue was $70.7 million, down 8% but above expectations of $68.3 million.

Declining inventories in the apparel industry have led to a decline in revenues

On the earnings conference call, Chief Financial Officer Cary Baker noted that lower apparel inventories in the retail sector accounted for a decrease in revenue in the second half of the year.

These declines don’t seem great, but Wall Street likes the revenues and earnings, especially as the rosy forecasts.

For the current quarter, the company targeted earnings of 11 cents per share on revenue of $73.5 million at the midpoint. Analysts had expected net income of two cents per share on revenue of $70.8 million.

Impinj appears to be entering a phase of rapid growth.

For the full year, Wall Street expects earnings of 98 cents per share, an increase of 33%. This would be the company’s highest earnings per share since it went public in 2026.

Next year, analysts expect Impinj’s earnings to rise 95% to $1.92 per share.

Internet of Things specialist

Impinj is part of the thriving Internet of Things (IoT) industry.

The term refers to everyday objects such as cars, household appliances or wearable devices that are connected to the Internet and can communicate with each other. In commercial and industrial uses, for example, it allows companies to track items through the production, distribution and sales stages.

The Delta Air Lines example is easy for consumers to understand: Bags are tracked as they are sorted, loaded onto a flight, and delivered to baggage claim. Passengers can track the journey of their bags on an app.

Like many other companies, Impinj is laying off workers as part of a rationalization drive to boost net profit.

Impinj analyst forecasts show a consensus view of “Moderate Buy”, with a price target of $106.43, an upside of 1.57%.

That doesn’t seem like much, and it partly reflects poor analyst coverage, typical of a company whose market capitalization is just $2.836 billion.

Analysts Raise Impinj Price Targets

Following the fourth-quarter report, Goldman Sachs increased its price target on Impinj to $115. Needham’s James Ricchiuti reiterated his “buy” rating on Impinj shares, raising his price target to $120. Impinj is part of the semiconductor stocks subsector, but is far too small to be included in the S&P 500.

It is a component of the SPDR S&P Semiconductor ETF NYSEARCA: XSDwith a distribution of 3.32%.

It is a flagship component along with Nvidia Corp. NASDAQ:NVDA, Broadcom Inc. NASDAQ: AVGO, Marvell Technology Inc. NASDAQ: MRVL AND Advanced Micro Devices Inc. NASDAQ:AMD.

We suppose you’re wondering how this could relate to those chip giants, given Impinj’s market capitalization. In that case, the underlying semiconductor index carries the same weight, giving it a tilt toward smaller, growing chipmakers like Impinj.

Including such an index can help a stock like Impinj, attracting more analyst attention and investment as the ETF rebalances.

Before you consider Impinj, you’ll want to hear this.

MarketBeat tracks daily Wall Street’s highest-rated and best-performing research analysts and the stocks they recommend to their clients. MarketBeat identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market takes hold… and Impinj wasn’t on the list.

While Impinj currently has a “Moderate Buy” rating among analysts, top analysts believe these five stocks are better buys.

View the five stocks here