We recently compiled a list of the 12 Best Internet of Things Stocks To Buy According to Analysts. In this article, we are going to take a look at where Sensata Technologies Holding plc (NYSE:ST) stands against the other IoT stocks.
Trends and Outlook for The Internet of Things Industry
According to the IOT analytics, 2024 was a poor year for the Internet of Things sector, particularly due to the headwinds from the hardware sector. As per the report published on January 15, many IoT-centric industries experienced stunted year-over-year growth. The industrial software market grew 12% year-over-year, slightly slower than the growth in 2023, whereas the industrial hardware industry experienced market declines. However, despite the slowdown the number of IoT connected devices grew around 13% year-over-year, surpassing 18 billion. In addition, the expertise spending related to IoT also increased by 10% year-over-year to reach $298 billion in 2024. The report also highlighted that the discussion on IoT remained high among leading CEO’s of the technology industry. The public relevance of the term Internet of Things remained within 30% of its all-time high in 2022.
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Moreover, another report by McKinsey & Company states that IoT can offer significant economic value potential. The report highlights that IoT can unlock $5.5 trillion to $12.6 trillion in economic value by consumer IoT products and services. McKinney & Company predicts that the most economic value of the technology will come from its deployment in industrial environments including manufacturing, health care, and other areas. Factory setting is expected to be the largest beneficiary by generating around $1.4 trillion to $3.3 trillion by 2030, or 26% of the total value. Lastly, the perceived value of IoT, the technological advancements, and the emergence of 5G in Networking are anticipated to be the prominent tailwinds for the sector.
Our Methodology
To compile the list of the 12 best Internet of Things stocks to buy according to analysts we used the Global X Internet of Things ETF. Using the ETF we aggregated a list of IoT stocks with positive analyst upside potential (at least 10%), sourced from CNN. Lastly, we ranked the stocks in ascending order of the analyst upside potential. Please note that the data was retrieved on Monday, 17th February, 2025.
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A network of technicians in lab coats testing the performance of a sensor-based solution.
Sensata Technologies Holding plc (NYSE:ST)
Analyst Upside Potential: 25.25%
Sensata Technologies Holding plc (NYSE:ST) is a company that specializes in creating and selling sensors and related technologies. These sensors are used to detect various conditions like pressure, temperature, or speed in different industries. It operates through two main areas: Performance Sensing and Sensing Solutions. The Performance Sensing business focuses on the automotive industry and heavy vehicles like construction equipment. Whereas, the Sensing Solutions segment serves industries outside of automotive, such as aerospace, industrial manufacturing, HVAC systems, renewable energy systems, and more.
On February 12, Joseph C Giordano, an analyst at TD Cowen maintained a Buy rating on the stock while keeping the price target of $45. The Performance Segment of Sensata Technologies Holding plc (NYSE:ST) is the main revenue contributor for the company. During the fiscal year 2024, the segment generated $2.74 billion and held steady despite market contraction. Management noted that it is focusing on three main pillars including returning to growth through innovation and strategic customer partnerships, operational excellence to deliver high-quality products efficiently, and free cash flow generation, reducing net leverage, share repurchases, and maintaining dividends. Sensata Technologies Holding plc (NYSE:ST) is well-positioned across its business segments with a diverse product portfolio serving automotive (ICE & EV), industrial, and aerospace markets, making it one of the best Internet of Things stocks to buy according to analysts.
Overall ST ranks 3rd on our list of the best IoT stocks to buy according to analysts. While we acknowledge the potential of ST as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ST but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.