It has been about a month since the last earnings report for GE HealthCare Technologies (GEHC Quick QuoteGEHC - Free Report) . Shares have added about 13.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is GE HealthCare due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

GE HealthCare Q4 Earnings Beat, Volume & Price Improve

GE HealthCare reported fourth-quarter 2023 adjusted earnings per share (EPS) of $1.18, which beat the Zacks Consensus Estimate of $1.07 by 10.3%. The bottom line, however, declined 9.9% year over year.

GAAP EPS in the quarter was 88 cents, down 27.3% from the year-ago quarter’s level.

Revenue Details

This currently Zacks Rank #3 (Hold) company reported revenues of $5.2 billion, up 5% from the prior-year quarter’s recorded number, reportedly as well as organically. The growth was driven by an improvement in pricing and higher volume. The top line also beat the Zacks Consensus Estimate by 2.2%.

Segmental Details

Imaging

Revenues from this segment totaled $2.8 billion, indicating a year-over-year improvement of 4%, reportedly as well as organically.

Segment EBIT was $337 million, up 5% year over year.

Ultrasound

This segment’s revenues totaled $944 million, down 1% year over year. Organically, revenues declined 2%.

Segment EBIT was $244 million, down 14.4% year over year.

Patient Care Solutions

Revenues from this segment amounted to $827 million, up 5% from the year-ago quarter’s level. Organically, revenues improved 4%.

Segment EBIT was $244 million, down 15.4% year over year.

Pharmaceutical Diagnostics

Revenues from this segment amounted to $144 million, up 25% from the year-ago quarter’s level. Organically, revenues improved 23%.

Segment EBIT was $244 million, up 32.1% year over year.

Margins

Net income margin was 7.7%, down 350 basis points (bps) from the prior-year period’s level, primarily due to standalone interest expense.

Cash flow from operating activities was $1.1 billion, down $13 million year over year.

Full-Year Results

GE HealthCare recorded total revenues of $19.6 billion in 2023, up 7% year over year. Organically, revenues increased 8%. Adjusted EPS for 2023 was $3.93, down 15.1% from the prior-year figure.

Financial Position

GEHC exited the fourth quarter with cash, cash equivalents and investments of $2.5 billion compared with $2.41 billion in the previous quarter.

Total assets increased to $32.45 billion from $32.38 billion in the prior quarter.

The company repaid $850 million of debt in the fourth quarter of 2023, followed by an additional $150 million in January.

2024 Guidance

GE HealthCare issued its earnings and revenue guidance for 2024.

For 2024, the company expects adjusted EPS in the range of $4.20-$4.35, implying an estimated growth of 7-11% over 2023. Revenues are anticipated to improve 4% organically. The Zacks Consensus Estimate for EPS and sales is pegged at $4.24 and $20.28 billion, respectively.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

Currently, GE HealthCare has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, GE HealthCare has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.