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Agilent Technologies (A - Free Report) reported third-quarter fiscal 2021 earnings of $1.10 per share, beating the Zacks Consensus Estimate by 11.1%. Further, the bottom line improved 41% year over year and 13.4% sequentially.
Revenues of $1.59 billion surpassed the Zacks Consensus Estimate by 3.9%. Further, the figure was up 26% on a reported basis and 21% on a core basis from the year-ago quarter. In addition, the figure increased 4.6% from the previous quarter.
The year-over-year revenue improvement was driven by strong growth across all regions, business groups and end-markets served. Also, solid momentum across all operating segments contributed well.
In terms of major markets, Analytical Laboratory and Dx& Clinical accounted for 85% and 15% of total revenues, up 20% and 28% on a core basis, respectively, from the prior-year quarter.
Agilent Technologies, Inc. Price, Consensus and EPS Surprise
Agilent has three reporting segments — Life Sciences & Applied Markets Group (“LSAG”), Agilent Cross Lab Group (“ACG”), and Diagnostics and Genomics Group (“DGG”).
LSAG: The segment accounted for $680 million or 43% of its total revenues, up 22% year over year. This was driven by a positive environment across all end markets served, especially the pharma market. Also, strength in Cell Analysis, Liquid Chromatography and Mass Spectrometry platforms aided the results.
ACG: Revenues from the segment were $560 million, accounting for 35% of total revenues. Also, the top line improved 21% year over year, driven by increasing activity in customer labs and instrument connect rates.
DGG: Revenues increased 44% year over year to $346 million, accounting for the remaining 22% of total revenues. The top line was driven by strong growth across product lines and all regions served. Also, solid NASD GMP oligo business drove the results.
Operating Results
For the fiscal third quarter, gross margin in the LSAG segment expanded 70 basis points (bps) on a year-over-year basis to 60%.
DGG gross margin expanded 370 bps on a year-over-year basis to 53.5%. Yet, ACG gross margin contracted 10 bps to 52.5%.
The increase in margins was driven by strong top-line growth and positive mix.
Research & development costs were $113 million, up 22.8% year over year. Selling, general & administrative expenses were $403 million, which increased 16.1% year over year.
Operating margin for the fiscal third quarter was 26%, which expanded 230 bps on a year-over-year basis.
Segment-wise, operating margin for LSAG expanded 240 bps year over year to 25%. The DGG segment’s operating margin expanded 540 bps on a year-over-year basis to 22.6%. ACG operating margin was 29.3%, which expanded 90 bps from the year-ago quarter.
Balance Sheet
As of Jul 31, 2021, Agilent’s cash and cash equivalents were $1.43 billion, up from $1.38 billion on Apr 30, 2021.
Accounts receivables were $1.12 billion at fiscal third quarter-end, up from $1.08 billion at fiscal second quarter-end.
Further, total debt (short + long term) was $2.86 billion for the reported quarter compared with $2.93 billion in the prior quarter.
Outlook
For the fiscal fourth quarter, the company expects revenues of $1.63-$1.66 billion. The Zacks Consensus Estimate for revenues stands at $1.60 billion.
Non-GAAP earnings per share are expected to be $1.15-1.18 per share. The Zacks Consensus Estimate for earnings is pegged at $1.10 per share.
For fiscal 2021, Agilent raised its revenue guidance from $6.15-$6.21 billion to $6.29-$6.32 billion. The company expects strong momentum across the business to continue. The Zacks Consensus Estimate for full-year revenues is pegged at $6.20 billion.
Also, management upwardly revised its non-GAAP earnings guidance from $4.09-$4.14 per share to $4.28-$4.31. The Zacks Consensus Estimate for earnings is pegged at $4.13 per share.
Zacks Rank & Stocks to Consider
Currently, Agilent carries a Zacks Rank #3 (Hold).
Long-term earnings growth rates for Digital Turbine, Advanced Micro Devices and ASML Holding are currently projected at 50%, 44.6% and 33.5%, respectively.
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Agilent (A) Q3 Earnings & Revenues Beat Estimates, Rise Y/Y
Agilent Technologies (A - Free Report) reported third-quarter fiscal 2021 earnings of $1.10 per share, beating the Zacks Consensus Estimate by 11.1%. Further, the bottom line improved 41% year over year and 13.4% sequentially.
Revenues of $1.59 billion surpassed the Zacks Consensus Estimate by 3.9%. Further, the figure was up 26% on a reported basis and 21% on a core basis from the year-ago quarter. In addition, the figure increased 4.6% from the previous quarter.
The year-over-year revenue improvement was driven by strong growth across all regions, business groups and end-markets served. Also, solid momentum across all operating segments contributed well.
In terms of major markets, Analytical Laboratory and Dx& Clinical accounted for 85% and 15% of total revenues, up 20% and 28% on a core basis, respectively, from the prior-year quarter.
Agilent Technologies, Inc. Price, Consensus and EPS Surprise
Agilent Technologies, Inc. price-consensus-eps-surprise-chart | Agilent Technologies, Inc. Quote
Segmental Top-Line Details
Agilent has three reporting segments — Life Sciences & Applied Markets Group (“LSAG”), Agilent Cross Lab Group (“ACG”), and Diagnostics and Genomics Group (“DGG”).
LSAG: The segment accounted for $680 million or 43% of its total revenues, up 22% year over year. This was driven by a positive environment across all end markets served, especially the pharma market. Also, strength in Cell Analysis, Liquid Chromatography and Mass Spectrometry platforms aided the results.
ACG: Revenues from the segment were $560 million, accounting for 35% of total revenues. Also, the top line improved 21% year over year, driven by increasing activity in customer labs and instrument connect rates.
DGG: Revenues increased 44% year over year to $346 million, accounting for the remaining 22% of total revenues. The top line was driven by strong growth across product lines and all regions served. Also, solid NASD GMP oligo business drove the results.
Operating Results
For the fiscal third quarter, gross margin in the LSAG segment expanded 70 basis points (bps) on a year-over-year basis to 60%.
DGG gross margin expanded 370 bps on a year-over-year basis to 53.5%. Yet, ACG gross margin contracted 10 bps to 52.5%.
The increase in margins was driven by strong top-line growth and positive mix.
Research & development costs were $113 million, up 22.8% year over year. Selling, general & administrative expenses were $403 million, which increased 16.1% year over year.
Operating margin for the fiscal third quarter was 26%, which expanded 230 bps on a year-over-year basis.
Segment-wise, operating margin for LSAG expanded 240 bps year over year to 25%. The DGG segment’s operating margin expanded 540 bps on a year-over-year basis to 22.6%. ACG operating margin was 29.3%, which expanded 90 bps from the year-ago quarter.
Balance Sheet
As of Jul 31, 2021, Agilent’s cash and cash equivalents were $1.43 billion, up from $1.38 billion on Apr 30, 2021.
Accounts receivables were $1.12 billion at fiscal third quarter-end, up from $1.08 billion at fiscal second quarter-end.
Further, total debt (short + long term) was $2.86 billion for the reported quarter compared with $2.93 billion in the prior quarter.
Outlook
For the fiscal fourth quarter, the company expects revenues of $1.63-$1.66 billion. The Zacks Consensus Estimate for revenues stands at $1.60 billion.
Non-GAAP earnings per share are expected to be $1.15-1.18 per share. The Zacks Consensus Estimate for earnings is pegged at $1.10 per share.
For fiscal 2021, Agilent raised its revenue guidance from $6.15-$6.21 billion to $6.29-$6.32 billion. The company expects strong momentum across the business to continue. The Zacks Consensus Estimate for full-year revenues is pegged at $6.20 billion.
Also, management upwardly revised its non-GAAP earnings guidance from $4.09-$4.14 per share to $4.28-$4.31. The Zacks Consensus Estimate for earnings is pegged at $4.13 per share.
Zacks Rank & Stocks to Consider
Currently, Agilent carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector include Digital Turbine (APPS - Free Report) , Advanced Micro Devices (AMD - Free Report) and ASML Holding N.V. (ASML - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth rates for Digital Turbine, Advanced Micro Devices and ASML Holding are currently projected at 50%, 44.6% and 33.5%, respectively.