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Motorola Reports Excellent Q2 Results, Lifts FY2021 Guidance
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Motorola Reports Excellent Q2 Results, Lifts FY2021 Guidance

Shares of communications equipment firm Motorola Solutions (MSI) surged 1.4% in extended trading on Thursday after the company reported solid second-quarter 2021 financial results. Motorola provides communication services, software, devices, accessories and infrastructure.

Adjusted earnings per share increased 49% year-over-year to $2.07, beating the Street’s estimate of $1.92. Sales grew 22% to $2 billion and surpassed expectations of $1.94 billion.

Products and Systems Integration Segment’s sales rose 24% year-over-year to $1.2 billion primarily due to the growth witnessed in video security and land mobile radio (LMR) services. A rise in command center software, video security and LMR services led to a 19% increase in sales of the Software and Services Segment to $773 million.

For the third quarter, Motorola expects revenue growth of around 10% year-over-year, and adjusted EPS in the range of $2.09 to $2.14. (See Motorola stock chart on TipRanks)

Furthermore, the company expects 2021 revenue growth of 9.5% to 10%, up from the earlier guidance range of 8% to 9%. It has also raised the adjusted EPS guidance range to $8.88-$8.98 from the previous projection of $8.70-$8.80.

The Chairman and CEO of Motorola Solutions, Greg Brown, said, “The continued strong demand for our mission-critical technologies is driving our increased expectations for the full year.”

Last month, Northcoast Research analyst Keith Houssum reiterated a Buy rating on the stock and increased the price target to $244 from $215 (9.8% upside potential). The analyst expects the company’s earnings to grow in double digits beyond 2022.

Overall, the stock has a Strong Buy consensus based on 6 Buys and 1 Hold. The average Motorola Solutions price target of $244.14 implies 9.8% upside potential. The company’s shares have gained 54.3% over the past year.

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