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Johnson Matthey (JMPLY) Sells Medical Device Unit for $700M
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Johnson Matthey Plc (JMPLY - Free Report) reached a definitive agreement to sell its Medical Device Components business (MDC) to Montagu Private Equity (Montagu) for $700 million (£550 million) in cash, with no associated debt.
MDC specializes in manufacturing components for medical device companies globally, with a particular emphasis on precious metal alloys and nitinol. Operating through its facilities in the United States (San Diego), Mexico (Mexicali) and Australia (Tullamarine), MDC serves a diverse international customer base.
With the announcement of MDC's sale, alongside the separate divestment of its Battery Systems business, Johnson Matthey completed its Value Businesses divestment program. It was initially disclosed in May 2022 as a strategic objective. Total net proceeds from divestments carried out by the company have surpassed the targeted £300 million. This disposal program for Value Businesses promises tangible benefits to shareholders through value realization, operational streamlining and a renewed focus on growth areas where Johnson Matthey has historically excelled.
Aligned with its capital allocation policy, JMPLY’s board plans to allocate £250 million of the net proceeds from the MDC sale to initiate an on-market share buyback program, subject to completion. The remaining proceeds will be utilized to repay a portion of Johnson Matthey's existing debt and for general corporate purposes. The cash proceeds from the sale will be distributed upon completion, which is subject to regulatory approvals. The deal is expected to close around the third quarter of 2024.
Recognized as a vital component of Johnson Matthey's portfolio, MDC exhibited technological excellence and substantial growth within the critical health sector.
In the past year, the stock has lost 4.6% against the industry’s 4% fall in the same period.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Johnson Matthey currently carries a Zacks Rank #3 (Hold).
The consensus estimate for CRS’ current fiscal year earnings is pegged at $4 per share, indicating a year-over-year surge of 250.9%. CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 12.2%. The company’s shares have increased 64.8% in the past year.
Ecolab has a projected earnings growth rate of 22.65% for the current year. The Zacks Consensus Estimate for ECL’s current-year earnings has been revised upward by 5.4% in the past 60 days. ECL topped the consensus estimate in each of the last four quarters, with the average earnings surprise being 1.7%. The company’s shares have rallied 41.7% in the past year.
The consensus estimate for HWKN’s current fiscal year earnings is pegged at $3.61 per share, indicating a 26% year-over-year rise. HWKN beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 30.6%. The company’s shares have surged 77.5% in the past year.
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Johnson Matthey (JMPLY) Sells Medical Device Unit for $700M
Johnson Matthey Plc (JMPLY - Free Report) reached a definitive agreement to sell its Medical Device Components business (MDC) to Montagu Private Equity (Montagu) for $700 million (£550 million) in cash, with no associated debt.
MDC specializes in manufacturing components for medical device companies globally, with a particular emphasis on precious metal alloys and nitinol. Operating through its facilities in the United States (San Diego), Mexico (Mexicali) and Australia (Tullamarine), MDC serves a diverse international customer base.
With the announcement of MDC's sale, alongside the separate divestment of its Battery Systems business, Johnson Matthey completed its Value Businesses divestment program. It was initially disclosed in May 2022 as a strategic objective. Total net proceeds from divestments carried out by the company have surpassed the targeted £300 million. This disposal program for Value Businesses promises tangible benefits to shareholders through value realization, operational streamlining and a renewed focus on growth areas where Johnson Matthey has historically excelled.
Aligned with its capital allocation policy, JMPLY’s board plans to allocate £250 million of the net proceeds from the MDC sale to initiate an on-market share buyback program, subject to completion. The remaining proceeds will be utilized to repay a portion of Johnson Matthey's existing debt and for general corporate purposes. The cash proceeds from the sale will be distributed upon completion, which is subject to regulatory approvals. The deal is expected to close around the third quarter of 2024.
Recognized as a vital component of Johnson Matthey's portfolio, MDC exhibited technological excellence and substantial growth within the critical health sector.
In the past year, the stock has lost 4.6% against the industry’s 4% fall in the same period.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Johnson Matthey currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Basic Materials space are Carpenter Technology Corporation (CRS - Free Report) and Ecolab Inc. (ECL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy), and Hawkins, Inc. (HWKN - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for CRS’ current fiscal year earnings is pegged at $4 per share, indicating a year-over-year surge of 250.9%. CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 12.2%. The company’s shares have increased 64.8% in the past year.
Ecolab has a projected earnings growth rate of 22.65% for the current year. The Zacks Consensus Estimate for ECL’s current-year earnings has been revised upward by 5.4% in the past 60 days. ECL topped the consensus estimate in each of the last four quarters, with the average earnings surprise being 1.7%. The company’s shares have rallied 41.7% in the past year.
The consensus estimate for HWKN’s current fiscal year earnings is pegged at $3.61 per share, indicating a 26% year-over-year rise. HWKN beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 30.6%. The company’s shares have surged 77.5% in the past year.