Zebra Technologies Corporation: Surprising Margin Strength in Q1 Speaks to Successful Mitigation Steps to Date; Focus Turns Back to Durability of Revenue Growth

Research evidence excerpt

Zebra Technologies Corporation: Surprising Margin Strength in Q1 Speaks to Successful Mitigation Steps to Date; Focus Turns Back to Durability of Revenue Growth

UpdateM

RiskRisk RewardReward– Zebra -TechnologiesZebra TechnologiesCorporation (ZBRA.O)Corporation (ZBRA.O)

Demand Returning; Need to Gain Confidence in Memory Impacts Before Stepping In

PRICE TARGET $323.00 EQUAL-WEIGHT THESIS

16x FY27 P/E of ~$20.20. Our multiple is slightly below the S&P 500 P/E multiple and 3-year ▪Slight discount to S&P 500 P/T multiple

averages given retail exposure in an uncertain macro environment. warranted given long-term opportunity and

attractive growth drivers, offset by near- $326.69

term tariff implications

Consensus Price Target Distribution $256.00 $400.00 environment over NTM in a MS PT ▪Demand

healthier position as large customer activitySource: Refinitiv, Morgan Stanley Research Mean Morgan Stanley Estimates

beginning to normalize and retail /

distribution capex improves.

▪Non-core businesses (RFID / Machine

RISK REWARD CHART AND OPTIONS IMPLIED PROBABILITIES (12M) Vision) could drive incremental upside, but

would like evidence of traction before

turning more positive

USD

$420.00(+93.58%)$420.00$420.00(+93.58%)(+93.58%) ProbProbProb (>420.00)~4.9%(>420.00)~4.9%(>420.00)~4.9%

Consensus Rating Distribution

65% Overweight

$323.00(+48.88%)$323.00$323.00(+48.88%)(+48.88%)

ProbProbProb (>323.00)~21.0%(>323.00)~21.0%(>323.00)~21.0% 35% Equal-weight

300 0% Underweight

MS Rating

$216.96$216.96$216.96

200 Source: Refinitiv, Morgan Stanley Research

$208.00(-4.13%)$208.00$208.00(-4.13%)(-4.13%) ProbProbProb (<208.00)~37.1%(<208.00)~37.1%(<208.00)~37.1%

100 Risk Reward Themes

New Data Era: Positive

Secular Growth: Positive

0 Technology Diffusion: Positive

MAY '25 NOV '25 MAY '26 MAY '27