12 Best Automation Stocks To Buy According to Hedge Funds

10. Cognex Corporation (NASDAQ:CGNX)

No. of Hedge Fund Holders: 34

Cognex Corporation (NASDAQ:CGNX) offers machine vision products that solve critical manufacturing and distribution challenges. The company operates through the machine vision technology segment. Cognex Corporation’s products assist businesses in automating the manufacturing and tracking of discrete items such as mobile phones, EV batteries, and e-commerce packages.

The coming is making use of AI to advance its automation abilities. On January 14, Cognex Corporation (NASDAQ:CGNX) revealed the DataMan 290 and 390 barcode readers. These barcode readers utilize AI technology to streamline barcode scanning processes and increase operational efficiency. “The DataMan 290 outperformed other competitive solutions we tested, successfully reading codes that others couldn’t,” said the CEO of MTS – Modern Technology Systems, Peter Laurinčík.

In Q3 2024, Cognex Corporation launched AI-assisted labeling and a new AI model in its VisionPro deep learning products, which significantly reduces the time required to train vision models. The company’s AI-driven strategy will potentially increase its revenue as businesses look for AI-automated solutions. Moreover, the company is also expanding its customer base through its emerging customer initiative, with its first cohort of sales bringing in more than $1 million per week.

Impax Global Environmental Markets Fund stated the following regarding Cognex Corporation (NASDAQ:CGNX) in its Q3 2024 investor letter:

“Cognex Corporation (NASDAQ:CGNX) (Industrial Energy Efficiency, U.S.) sold off in the third quarter following a negative market reaction to the release of Q2 results. The share price had been moving higher throughout most of 2024 in anticipation of a recovery from factory automation weakness, with green shoots indicating abating headwinds and earnings normalization. While Q2 earnings exceeded expectations, below consensus Q3 guidance, management’s shift to a more cautious tone, and concerns of a weaker macroeconomic backdrop for this shorter-cycle, economically sensitive business, all contributed to a sharp sell-off. Despite a potential interruption of sequential improvement in their recovery, the long-term thesis remains intact.”