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Agilent (A) Expands Portfolio With Luxcel Biosciences Buyout


Agilent Technologies Inc. A has acquired a privately held company, Luxcel Biosciences. The terms of the deal have been kept confidential.

Based in Cork, Luxcel Biosciences develops real-time fluorescence plate-reader in vitro live-cell test kits.

This technology targets important applications, namely cell metabolism, bioenergetics, drug toxicity, and hypoxia and oxidative stress. The solutions are used by a variety of life science customers ranging from research institutions to pharmaceutical companies.

Post acquisition, the Luxcel team will continue to work in Cork. The team will work as sensor chemistries and bioassay solutions group within Agilent’s cell analysis division.

Following the deal, the company’s share price rose 2.46%. However shares of Agilent have slightly underperformed the industry in the 12-month period. The stock has returned 49.2% compared with the industry’s growth of 49.9%.

Deal Rationale

The acquisition will allow Agilent to strengthen its presence in the high-growth cell analysis market.

Per a research report, the global cell analysis market is expected to reach $26.0 billion by 2020 from $19.0 billion in 2015, witnessing a compound annual growth rate (CAGR) of 6.56% from 2015 to 2020.

Given the strong growth in this market, we believe Luxcel Biosciences deal will help Agilent to cash in on the fast-growing cell analysis market.

Additionally, the deal complements Agilent’s own product expansion efforts with the addition of assay kits that are compatible with industry standard plate-readers. The deal will help Agilent in offering better services to researchers and pharmaceutical customers.

Todd Christian, General Manager of Agilent's Cell Analysis Division, said, “Technological advancements allowing researchers to examine cell health and function kinetically and in real-time are driving global demand for complete cell analysis solutions. Also, Luxcel's assay kits are optimized for standard fluorescent plate readers for broad customer application helping to address this growing demand."

Our Take

Agilent Technologies is a broad-based original equipment manufacturer of test and measurement equipment. The company has been supplementing organizational growth with strategic acquisitions and collaborations.

The company entered this market in 2015 with the acquisition of Seahorse Bioscience for $235 million. Seahorse’s XF technology has been utilized in research in an extensive range of diseases and disorders.

Agilent has made a number of acquisitions in different fields. In July 2017, the company acquired privately held Cobalt Light Systems for approximately £40 million. The deal has strengthened its presence in the high-growth Raman spectroscopy market.

We remain optimistic about Agilent's broad-based portfolio and increased focus on segments with higher growth potential.

Zacks Rank & Stocks to Consider

Currently, Agilent has a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader technology sector are ASML Holding N.V. ASML, Lam Research Corporation LRCX and PetMed Express, Inc. PETS, each sporting a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings per share growth rate for ASML Holding, Lam Research and PetMed Express is projected to be 22.6%, 14.9% and 10%, respectively.

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