Cognex shares soar on higher 1Q profit, strong outlook

NEW YORK—Shares of Cognex Corp. rose Monday morning, a day after the company said its first-quarter earnings grew 85 percent largely on higher sales in its factory automation segment.

For the quarter ending March 30, Cognex said its income climbed to $8.5 million, or 20 cents per share, from $4.6 million, or 10 cents per share last year.

Revenue grew 19 percent to $60.5 million from $50.9 million in the year-ago quarter.

Analysts polled by Thomson Financial expected a profit of 17 cents per share, on average.

For the second quarter, Cognex projected earnings between 20 cents and 24 cents per share. Analysts polled by Thomson Financial expect second-quarter earnings of 20 cents per share.

Shares of Cognex soared Tuesday morning, gaining $2.61, or 11.4 percent, to $25.61. They earlier hit a fresh 52-week high of $26.43 earlier in the session. The stock has ranged from $14.67 to $25.87 over the past year.

In a note to investors on Tuesday, Robert W. Baird analyst Richard Eastman raised his full-year profit outlook on Cognex to 88 cents per share from 75 cents. He maintained his "Neutral" rating.

He said the company's results were close to expectations when excluding a 2 cents per share benefit from lower options expenses. Eastman attributed much of the growth in the company's factory automation division to higher sales overseas, which may or may not persist.

Separately, ThinkEquity analyst Suresh Balaraman maintained his "Buy" rating on Cognex, but removed the company from his "Top Pick" list, saying its recent appreciation in value makes it no longer underpriced.

He raised his 2008 outlook to 99 cents per share from 83 cents. Analysts polled by Thomson Financial expect full-year earnings of 83 cents per share.

Cognex, based in Natick, Mass., makes vision systems for the manufacturing industry.