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ABB Eyes Robotics Portfolio Expansion on Gomtec Buy - Analyst Blog

One of the largest providers of industrial robots and modular manufacturing systems, ABB Ltd.ABB , recently announced the acquisition of Munich-based private company, Gomtec GmbH, as part of its efforts to expand the collaborative robotics portfolio. However, the financial terms of the transaction were kept under wraps.

Inside the Headlines

Gomtec pioneers in the development of mechatronic systems that integrate telecommunications, control, mechanical, electrical and computer engineering sectors. Powered by Gomtec's technology platform, ABB plans to build state-of-the-art "safe-by-design" robots that eliminate the usage of protective fencing. This will enable the new-generation robots to function hand-in-hand with humans. Also, the new robots can be deployed in a variety of applications that will unlock fresh opportunities in the field of collaborative robotics.

ABB has been making concerted efforts to strengthen its human-robot collaborative automation technologies over the past and acquisition of Gomtec is in sync with these efforts. This month, the company also unveiled the first-of-its-kind, dual-arm industrial robot YuMi that will efficiently automate small-parts assembly lines and increase their productivity.

Bottom Line

From a broader perspective, this acquisition marks ABB's attempt to accomplish its Next Level Strategy, a scheme through which it aspires to create sustainable value. We believe the company's latest strategy is led by the rising popularity of automation innovation that helps manufacturers improve flexibility, agility and competitiveness of production.

Management believes that armed with the new technology, the company will avail better commercial opportunities like foraying into new markets and improving the production capability of traditional industry manufacturers. Reiterating management's optimistic outlook, we believe that ABB, with a proven track record of having installed 25,000 robots globally and supported by Gomtec's cutting-edge technology, would gain greater market share in the collaborative automation robotics industry, going forward.

Zacks Rank

ABB currently has a Zacks Rank #4 (Sell). Better-ranked stocks in the industry include Dycom Industries Inc. DY , Layne Christensen Company LAYN and AO Smith Corp. AOS . While Dycom Industries sports a Zacks Rank #1 (Strong Buy), both Layne Christensen Company and AO Smith carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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