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Zebra: Keeping Its Stripes

In a recent initiative, President Clinton has set the goal to cut medical errors by 50% over the next five years. True, there will be some whiz-bang technologies to help out. But sometimes low-tech solutions can be just as effective. A case in point is bar coding. This technology can be used for such things as patient charts, wristbands, lab texts and x-rays. A company that is a leader in the field is Zebra Technologies .

Zebra offers a comprehensive line of bar code printers. They range from industrial to office use. Its latest printer is the Xi Series. The printer provides for alerts for error notification, as well as Web-enabled monitoring and configuration. You know the status of your printer - anytime, anywhere. There are more than 1.5 million Zebra printers installed.

Zebra also has software products. Bar-One is an easy-to-use graphical program to help design bar code labels. With JetForm Central, you can then transform ERP data into bar codes.

But Zebra has been continuing to innovate. One of the most promising areas is wireless. In fact, Zebra recently purchased a privately-held company called Comtec Information Systems. The company is a leader in the development of wireless thermal printing solutions.

To further the innovation, Zebra entered a strategic alliance with Texas Instruments to develop wireless applications for chain logistics applications (that is, warehouse management). The companies will work on such cutting-edge technologies as smart labels, high-powered readers and advanced encoders.

In the past quarter, Zebra generated net sales of $128 million, which was up from $97.3 million in the same period a year ago. Net income was an impressive $21.5 million, which was up from $17.9 million. The company also announced a buyback of 2 million shares.

So far, it looks like the purchase of Comtec has been a smart move. It has added key technologies and has also been accretive to earnings. Expect similar acquisitions.

Also, the wireless market should help to accelerate the growth-rate of Zebra, as it develops the key standards with Texas Instruments. True, bar coding is not sexy technology, but it is very profitable.