Why Samsara Stock Is Plummeting Today

Samsara (NYSE: IOT) stock is plunging in Friday's trading following the company's earnings report. The Internet of Things (IoT) company's share price was down 17.3% as of 12:30 p.m. ET.

Samsara published its Q4 results yesterday and actually delivered sales and earnings that beat Wall Street's targets. But the company's forward guidance came in a bit below the market's expectations, and investors are concerned about slowing growth and softening margins.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Samsara stock falls despite Q4 beats

Samsara posted non-GAAP (adjusted) earnings per share of $0.11 on sales of $346.29 million in the fourth quarter, which came in ahead of the average analyst estimate's call for per-share earnings of $0.07 on sales of $335.6 million.

Sales were up 25.3% year over year in the period, and adjusted earnings per share saw a big improvement over the profit of $0.04 posted in the prior-year quarter. All in all, it was a good quarter for the business, but investors are seeing warning signs in the company's guidance.

What's next for Samsara?

For this year, management is guiding for sales to come in between $1.523 billion and $1.533 billion, with the midpoint of that guidance range falling a bit short of the average Wall Street target's call for sales of $1.53 billion. Meanwhile, adjusted earnings per share are projected to come in between $0.32 and $0.34, which is well ahead of the average analyst estimate's call for adjusted earnings per share of $0.28.

But some investors were looking for a significantly stronger sales forecast to support the company's growth-dependent valuation. They are also concerned about the high level of stock-based compensation that is backed out of the adjusted earnings forecast.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $286,710!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $44,617!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $488,792!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

Continue »

*Stock Advisor returns as of March 3, 2025

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool recommends Samsara. The Motley Fool has a disclosure policy.