Can CGNX sustain its EPS momentum in 2025?

**Cognex's EPS momentum in 2025 is likely to be cautious**, considering both the company's financial outlook and the broader market analysis. Here's a detailed assessment:

1. **Recent Performance and Outlook**:
- Cognex's Non-GAAP EPS for Q4 2024 was $0.20, which beat expectations by $0.04. This indicates a recent positive trend in earnings performance.
- However, the company's financial outlook for Q1 2025 projects revenue between $200 million and $220 million, which is slightly below the consensus of $227.22 million. This suggests a potential slowdown in revenue growth, which could impact EPS momentum.
2. **Market Analysts' Perspectives**:
- Credit Suisse analyst Guy Hardwick maintains a Neutral rating on Cognex, increasing the price target to $46. This neutral stance implies a cautious optimism about Cognex's future performance.
- Swiss National Bank has decreased its stake in Cognex, which could be interpreted as a reduced confidence in the company's short-term prospects. This move, coupled with insiders selling off holdings, suggests that the market may be cautious about Cognex's EPS sustainability.
3. **Historical EPS Trends**:
- Cognex's EPS has shown a general upward trend over the past three years, from $0.62 in 2024 Q4 to $1.23 in 2022 Q4.
- However, the EPS in 2023 Q4 was $0.65, which was lower than the previous quarter's EPS of $0.77. This indicates a potential volatility in EPS that could affect momentum.

|code|Ticker|Name|Date|Diluted EPS YoY|Diluted EPS|market_code|
|---|---|---|---|---|---|---|
|CGNX|CGNX.O|Cognex|2022 Q1|-2.5641025641025665|0.38|185|
|CGNX|CGNX.O|Cognex|2022 Q2|-20.93023255813953|0.34|185|
|CGNX|CGNX.O|Cognex|2022 Q3|-56.81818181818182|0.19|185|
|CGNX|CGNX.O|Cognex|2023 Q1|-60.526315789473685|0.15|185|
|CGNX|CGNX.O|Cognex|2023 Q2|-2.9411764705882377|0.33|185|
|CGNX|CGNX.O|Cognex|2023 Q3|-42.10526315789473|0.11|185|
|CGNX|CGNX.O|Cognex|2023 Q4||0.07|185|
|CGNX|CGNX.O|Cognex|2024 Q1|-53.333333333333336|0.07|185|
|CGNX|CGNX.O|Cognex|2024 Q2|-36.36363636363637|0.21|185|
|CGNX|CGNX.O|Cognex|2024 Q3|54.545454545454554|0.17|185|

4. **Challenges and Opportunities**:
- Cognex's machine vision products are driving automation growth, which is a positive sign for long-term EPS potential.
- The company's technology remains lucrative, and predicted annual EPS for the current year is $0.74, with a quarterly dividend payment system. These factors could support EPS stability.

In conclusion, while Cognex has shown positive EPS momentum in recent years and continues to benefit from growth in machine vision products, the cautious revenue outlook for 2025, combined with analysts' neutral stances and potential insider selling, suggests that sustaining EPS momentum could be challenging. The company's historical EPS volatility and the need to prove revenue growth consistency will be critical factors in determining whether CGNX can sustain its EPS momentum in 2025.