Time New York: Sun 27 May 13:22 pm  |  Save 15% on H&R Block Online

  
caticonslite_bm_alt

Agilent (A) Q1 Earnings & Revenues Beat, ’18 View Positive

Zacks

Agilent Technologies, Inc A delivered first-quarter fiscal 2018 non-GAAP earnings of 66 cents per share, which beat the Zacks Consensus Estimate by 8 cents. The figure also increased 24.5% from the year-ago quarter.

Revenues of $1.21 billion increased 13.2% year over year driven by strong growth across all regions, particularly Europe and Asia-Pacific. Europe (31.6% of revenues) increased 18.7% to $381 million, while Asia-Pacific (36.2% of revenues) grew 13.5% to $437 million. Americas increased almost 9% year over year to $393 million.

Segment Details

Life Sciences & Applied Markets Group (“LSAG”) revenues accounted for $616 million or 51.1% of total revenues, reflecting an increase of 14.3% year over year. This was driven by double-digit gains in major platforms led by Mass Spec and Cell analysis. Robust demand in Europe and China as well as strong end-markets drove top-line growth.

During the quarter, Agilent acquired Luxcel Biosciences, a developer of real-time fluorescence plate-readers based in-vitro cell assay kits.

Agilent Technologies, Inc. Price, Consensus and EPS Surprise


Agilent Technologies, Inc. Price, Consensus and EPS Surprise | Agilent Technologies, Inc. Quote

Diagnostics and Genomics Group (“DGG”) came in at $408 million or 33.8% of total revenues. The segment revenues were up 12.4% year over year, driven by strong demand for pathology products and companion diagnostics services.

During the quarter, Agilent launched CRISPR Activation and Interference (a/i) libraries and GenetiSure Dx Postnatal Assay.

Revenues from Agilent Cross Lab Group (“ACG”) came in at $182 million or 15.1% of total revenues, reflecting an increase of 11.7% year over year. Both services and consumables witnessed growth. China and Food led growth across all regions and major end-markets.

During the quarter, Agilent launched the ValueLab line of consumables for China and CrossLab Service Guarantee.

End-Market Revenue Details

Analytical Laboratory contributed 86% of revenues and increased 11% year over year.

Diagnostics & Clinical end-market accounted for the remaining 14% of revenues and increased 5% driven by robust performance from pathology and companion diagnostics, particularly in the Americas and Japan.

Analytical Laboratory comprises Pharma & Biotech, Academia & Govt., Environmental & Forensics, Food and Chemical & Energy end-markets.

Pharma & Biotech accounted for 29% of total revenues and increased 8% year over year on th back of balanced growth across instruments, services and consumables in both Small molecule and Bio-pharma.

Academia & Govt. accounted for 9% of total revenues and increased 11% year over year owing to strong demand in Europe and China.

Environmental & Forensics accounted for 12% of total revenues and increased 14% year over year driven by strength in Forensics and demand for GC, GC/MS, and ICP/MS.

Food contributed 11% of total revenues and increased 8% year over year led by consumables, mass spec and GC with regional strength in Europe.

Chemical & Energy contributed 25% of total revenues and increased 13% year over year led by robust performance across regions, products and sub-segments.

Operating Details

Non-GAAP gross margin expanded 170 basis points (bps) on a year-over-year basis to 56.7%.

Non-GAAP research & development (R&D) expenses as percentage of revenues declined 10 bps to 7.6%. However, non-GAAP selling, general & administrative (SG&A) expenses as percentage of revenues expanded 60 bps to 27.2%.

Non-GAAP operating margin expanded 140 bps on a year-over-year basis to 22.3% in the reported quarter.

Segment wise, LSAG and ACG operating margin expanded 240 bps and 120 bps on a year-over-year basis, respectively. However, DGG operating margin contracted 200 bps from the year-ago quarter.

Guidance

For second-quarter fiscal 2018, Agilent expects revenues between $1.20 billion and $1.22 billion, up 9.5% year over year at mid-point. Non-GAAP earnings are expected in the range of 61-63 cents.

For fiscal 2018, Agilent projects revenues in the range of $4.885-$4.905 billion and non-GAAP earnings in the range of $2.62-$2.68 per share.

At mid-point, adjusted operating margin is projected to be 22.6%.

Agilent anticipates returning dividends worth $190 million during the fiscal year. Currently, the company has a share buyback authorization worth $380 million.

Zacks Rank and Stocks to Consider

Currently, Agilent has a Zacks Rank #3 (Hold).

Stocks worth considering in the broader technology sector are Teradyne TER, AMETEK AME and Fortive FTV. While Teradyne sports a Zacks Rank #1 (Strong Buy), AMETEK and Fortive carry Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Teradyne, AMETEK and Fortive is projected to be 12%, 11.50% and 9.69%, respectively.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

To read this article on Zacks.com click here.

Zacks Investment Research
<-- You can share this post with your network,
or give us your opinion and leave a comment.
Be sure to check our RSS feeds for updates.