Faro Technologies (FARO) PT Lowered to $24 at Needham

Needham analyst James Ricchiuti lowered the price target on Faro Technologies (NASDAQ: FARO) to $24.00 (from $27.00) while maintaining a Buy rating.

The analyst commented: "In a Q2 earnings season that has seen disappointing results from many industrial tech companies, FARO’s Q2 print carried with it both good news and cautious commentary about the near-term outlook. Q2 revenues fell 7% y/o/y, vs. consensus -5%. NG gross margins and NG operating margins were well above expectations, resulting in an impressive EPS that was 50% above the high end of guidance. The strength in gross margins is a precursor, in our view, of what’s to come as the demand environment normalizes. FARO guided for Q3 revenues at the midpoint that were 4% below Street expectations, as customers scrutinize discretionary cap-ex spending. While demand is likely to be challenged in its key market verticals, we believe FARO is on track to deliver improved growth in 2025 as better margins provide the heavy earnings lift in 2024. Reaffirm Buy."

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