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AMETEK, Inc. (AME - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.68 per share, beating the Zacks Consensus Estimate by 3.7%. The bottom line rose 11% on a year-over-year basis.
Net sales of $1.73 billion surpassed the Zacks Consensus Estimate by 0.3%. The top line rose 6.5% year over year.
Top-line growth was driven by solid momentum across the Electronic Instruments Group (EIG) and Electromechanical Group (EMG) segments.
AMETEK’s proper execution of the four core growth strategies, including operational excellence, global market expansion, investments in product development and acquisitions, is expected to continue aiding financial growth in the near and long term. The AMETEK Growth Model is likely to continue driving its business performance.
EIG (71.4% of total sales): AMETEK generated sales of $1.24 billion from the segment, reflecting growth of 7% year over year. The figure topped the consensus mark of $1.131 billion.
EMG (28.6%): The segment generated $494.7 million in sales in the fourth quarter, which improved 6% on a year-over-year basis. The figure came below the Zacks Consensus Estimate of $520 million.
Operating Details
For the fourth quarter, operating expenses were $1.29 billion, up 4.8% year over year. The figure contracted 120 basis points (bps) from the year-ago quarter’s level as a percentage of net sales to 74.3%.
Operating margin was 25.7%, which expanded 120 bps from the year-ago quarter’s figure.
Operating margin for EIG expanded 250 bps year over year to 29% and that of EMG contracted 190 bps from the year-ago quarter’s level to 22.7%.
Balance Sheet
As of Dec 31, 2023, cash and cash equivalents were $409.8 million, down from $841.9 million as of Sep 30, 2023.
Long-term debt was $1.895 billion as of Dec 31, 2023, up from $1.86 billion as of Sep 30, 2023.
Guidance
For first-quarter 2024, management expects sales growth in low-double digits from the year-ago quarter’s reported figure. The Zacks Consensus Estimate is pegged at $1.76 billion.
AMETEK expects adjusted earnings of $1.56-$1.60 per share, suggesting growth of 5-7% from the year-ago quarter’s reported number. The consensus mark is pinned at $1.58 per share.
For 2024, AME expects sales growth in the low-double digits from the 2023 reported level. The Zacks Consensus Estimate is pegged at $7.27 billion.
Adjusted earnings are expected to be $6.70-$6.85 per share, suggesting growth of 5-7% from the 2023 reported level. The Zacks Consensus Estimate for earnings is pegged at $6.76 per share.
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AMETEK (AME) Q4 Earnings & Sales Surpass Estimates, Rise Y/Y
AMETEK, Inc. (AME - Free Report) reported fourth-quarter 2023 adjusted earnings of $1.68 per share, beating the Zacks Consensus Estimate by 3.7%. The bottom line rose 11% on a year-over-year basis.
Net sales of $1.73 billion surpassed the Zacks Consensus Estimate by 0.3%. The top line rose 6.5% year over year.
Top-line growth was driven by solid momentum across the Electronic Instruments Group (EIG) and Electromechanical Group (EMG) segments.
AMETEK’s proper execution of the four core growth strategies, including operational excellence, global market expansion, investments in product development and acquisitions, is expected to continue aiding financial growth in the near and long term. The AMETEK Growth Model is likely to continue driving its business performance.
AMETEK, Inc. Price, Consensus and EPS Surprise
AMETEK, Inc. price-consensus-eps-surprise-chart | AMETEK, Inc. Quote
Segments in Detail
EIG (71.4% of total sales): AMETEK generated sales of $1.24 billion from the segment, reflecting growth of 7% year over year. The figure topped the consensus mark of $1.131 billion.
EMG (28.6%): The segment generated $494.7 million in sales in the fourth quarter, which improved 6% on a year-over-year basis. The figure came below the Zacks Consensus Estimate of $520 million.
Operating Details
For the fourth quarter, operating expenses were $1.29 billion, up 4.8% year over year. The figure contracted 120 basis points (bps) from the year-ago quarter’s level as a percentage of net sales to 74.3%.
Operating margin was 25.7%, which expanded 120 bps from the year-ago quarter’s figure.
Operating margin for EIG expanded 250 bps year over year to 29% and that of EMG contracted 190 bps from the year-ago quarter’s level to 22.7%.
Balance Sheet
As of Dec 31, 2023, cash and cash equivalents were $409.8 million, down from $841.9 million as of Sep 30, 2023.
Long-term debt was $1.895 billion as of Dec 31, 2023, up from $1.86 billion as of Sep 30, 2023.
Guidance
For first-quarter 2024, management expects sales growth in low-double digits from the year-ago quarter’s reported figure. The Zacks Consensus Estimate is pegged at $1.76 billion.
AMETEK expects adjusted earnings of $1.56-$1.60 per share, suggesting growth of 5-7% from the year-ago quarter’s reported number. The consensus mark is pinned at $1.58 per share.
For 2024, AME expects sales growth in the low-double digits from the 2023 reported level. The Zacks Consensus Estimate is pegged at $7.27 billion.
Adjusted earnings are expected to be $6.70-$6.85 per share, suggesting growth of 5-7% from the 2023 reported level. The Zacks Consensus Estimate for earnings is pegged at $6.76 per share.
Zacks Rank & Other Stocks to Consider
AMETEK currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader technology sector are Arista Networks (ANET - Free Report) , Semtech (SMTC - Free Report) and Badger Meter (BMI - Free Report) . Arista Networks and Semtech sport a Zacks Rank #1 (Strong Buy) each, and Badger Meter carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Arista Networks shares have surged 110.5% in the past year. The long-term earnings growth rate for ANET is projected at 19.77%.
Semtech shares have lost 42.8% in the past year. The long-term earnings growth rate for SMTC is projected at 15%.
Badger Meter shares have gained 15.7% in the past year. The long-term earnings growth rate for BMI is pegged at 12.27%.