Samsara Inc. (IOT) Down 4.9% — Time to Reduce Exposure?
Key Points
Samsara Inc. (IOT) came under pressure in the latest session, retreating 4.91% as the stock slipped to $33.71 from a prior close of $35.45. In dollar terms, the shares lost $1.74 on the day, extending a broader slide that has left the stock well below recent levels. Trading activity was subdued, with volume of about 2.3 million shares running sharply below the 90-day average of roughly 5.6 million, suggesting the latest downdraft occurred in a relatively thin session rather than on heavy participation.
The stock is also losing ground when viewed against its longer-term trading range. At $33.71, Samsara is trading more than 45% under its 52-week high of $61.90 set on Feb. 19, 2025, highlighting how far the shares have retreated from prior peaks. This places the name closer to the lower end of its annual range and underscores the persistent headwinds the stock has faced. Within the broader cloud and software peer group, names such as CrowdStrike (CRWD), Snowflake (SNOW), Cloudflare (NET), Datadog (DDOG), and Atlassian (TEAM) have all experienced bouts of volatility, but Samsara’s sharp pullback from its high marks a more pronounced slide, reinforcing the sense that the stock remains under sustained selling pressure rather than staging a meaningful recovery.
Why Samsara Inc. Price is Moving Lower
Recent price weakness in Samsara Inc. comes despite seemingly strong headline fundamentals from its latest quarter, and that disconnect is putting pressure on the shares. The company’s Q3 FY2026 report delivered 29% year-over-year revenue growth to about $416 million and its first GAAP-profitable quarter, yet the stock has been stuck in a tight band around the mid‑$30s and drifting lower on muted trading activity. A bearish forecast calling for a potential slide to roughly $26.50 by early February has amplified concerns that prior optimism overshot fundamentals, especially after the stock previously traded as high as the low‑$60s over the past year.
Under the surface, several factors help explain why caution is building. Revenue growth, while solid, is decelerating on a sequential basis, with quarter‑over‑quarter expansion of about 6.3%, and the company still carries a negative profit margin near 3%, reminding investors that sustainable profitability remains tentative. Samsara also operates in a richly valued, high‑expectation software and services group that includes names like CrowdStrike, Snowflake, Cloudflare, Datadog, and Atlassian — a segment that has been sensitive to any sign of slowing growth or margin pressure. With sentiment indicators pointing toward “fear,” only about one‑third of recent trading days closing in the green, and the stock trading in the lower half of its 52‑week range, investors appear increasingly focused on execution risk, premium valuation and the possibility that growth may not be robust enough to justify prior price levels.
What is the Samsara Inc. Rating - Should I Sell?
Weiss Ratings assigns IOT a D rating. The stock was upgraded on 9/22/2023. Current recommendation is Sell. Despite that technical upgrade, a D rating still places Samsara squarely in high‑risk territory where the overall risk/reward profile remains unfavorable for shareholders.
The most concerning issue is the mismatch between Samsara’s operations and shareholder outcomes. The Excellent Growth Index and 29.19% revenue growth show the business is expanding quickly, but this has not translated into quality earnings or attractive valuation. Profit margin remains negative at -2.78%, and the forward P/E ratio of -452.75 is deeply distorted, signaling investors are paying a steep price for a company that is still losing money. The Very Weak Efficiency Index further indicates that management is generating poor returns on capital, a serious red flag for long‑term investors.
Risk metrics also warrant caution. While the Excellent Solvency Index suggests balance sheet strength, the Weak Volatility Index shows that price swings have been unfavorable relative to the returns delivered. The Fair Total Return Index confirms that, even with strong topline growth, shareholders have not been adequately compensated for the risks they are taking.
Within the Information Technology sector, Samsara’s D rating places it in the same challenged camp as CrowdStrike Holdings, Inc. (CRWD, D+) and Datadog, Inc. (DDOG, D+), and ahead of only weaker peers like Snowflake Inc. (SNOW, D-) and Atlassian Corporation (TEAM, E+). In this context, Samsara does not stand out as a superior choice, and its D rating signals that investors should remain defensive and highly selective around this name.
About Samsara Inc.
Samsara Inc. operates in the Information Technology sector, focusing on software and services that connect physical operations to the cloud. The company positions itself as a provider of an integrated “Connected Operations Cloud,” combining Internet of Things (IoT) devices, telematics, video-based safety, and data analytics. Its platform is designed to help organizations monitor vehicle fleets, equipment, and industrial assets, primarily targeting logistics, transportation, field services, construction, manufacturing, and other asset‑intensive industries. By aggregating data from sensors, gateways, and cameras, Samsara offers customers dashboards and applications that attempt to improve operational visibility, compliance, and safety.
The company’s core offerings include fleet management solutions, driver safety tools, equipment monitoring, and site visibility products, all delivered through a cloud-based software and services model. Samsara’s hardware components are tightly integrated with its software platform, creating a degree of vendor lock-in but also increasing implementation complexity and reliance on proprietary devices. Its competitive positioning rests on unifying disparate operational data into a single environment, yet it faces constant pressure from established telematics vendors, specialized safety-camera providers, and broader enterprise software and services companies that are expanding into industrial IoT. In this crowded landscape, differentiation depends on the depth of analytics, ease of deployment, and the ability to scale across large, distributed operations.
Investor Outlook
With Samsara Inc. (IOT) carrying a D (Sell) Weiss Rating, investors may want to exercise caution and closely monitor whether recent price action is supported by sustainable fundamentals rather than short-term sentiment. Watch for shifts in Information Technology sector trends, any improvement in the company’s risk profile, and potential upgrades or downgrades in the Weiss Rating that could signal a changing risk/reward balance. See full rankings of all D-rated Information Technology stocks inside the Weiss Stock Screener.
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