Cognex Corporation (CGNX) recently upgraded its revenue guidance for the third quarter of 2010.
Headquartered in Natick, Massachusetts USA, Cognex designs, develops, manufactures and markets machine vision sensors and systems. A lot of manufacturing equipment requires machine vision because of the increasing demand for speed and accuracy in manufacturing processes.
Revenues for the third quarter are now expected between $74 million and $76 million, substantially up from the previous guidance of $65 million – $68 million. The customers of the company are classified into three primary markets: the discrete factory automation market, the semiconductor and electronics capital equipment (SEMI) market, and the web and surface inspection market.
This increase in guidance is due to stronger-than-anticipated demand from the Factory Automation market – the largest market served by Cognex, which accounted for 69% of total revenue in the second quarter.
Management stated that Cognex typically sees softness in the order rate during the summer months, especially from Factory Automation customers based in Europe, but that seasonal trend did not occur this year. Instead, bookings were stronger than management’s expectation. Hence, Cognex expects to set a new record for quarterly revenues in the third quarter.
Earlier, Cognex reported strong results for the second quarter driven by increasing demand for machine vision by manufacturers worldwide as they strive to improve quality and lower costs.
The current Zacks Consensus Estimate for the third quarter is earnings of 25 cents per share. With the upgrade in guidance by Cognex, we expect upward revisions in the Consensus Estimate.
Cognex has consistently exceeded expectations. In the second quarter, the company’s earnings were 73% above the Zacks Consensus Estimate. On average, Cognex has come ahead of the Zacks Consensus Estimate by 97% in the last four quarters.
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