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PerkinElmer (PKI) Meets Q2 Earnings, Raises '17 Guidance

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Waltham, MA-based, PerkinElmer Inc. (PKI - Free Report) , a worldwide provider of products, services and solutions to the diagnostics, research and laboratory service markets, reported second-quarter 2017 adjusted earnings of 67 cents per share in line with the Zacks Consensus Estimate.

The company reported adjusted revenues of approximately $547.1 million, which came below the Zacks Consensus Estimate of $552.0 million. However, this came above the year-ago quarterly revenues of $536.2 million.

Segment Details

Discovery & Analytical Solutions (DAS): Revenues totaled $383.1 million in the second quarter, compared with $381.5 million in the year-ago quarter. This marked a 1% rise organically.

Meanwhile, operating profit margin, as a percentage of revenues, in the second quarter was 16.7%, above the prior-year quarter’s level of 15.7%.

Diagnostics Segment: In this segment, revenues were $163.8 million in the second quarter, as compared with $154.7 million in the year-ago quarter. This implies an 1% increase organically.

Meanwhile, operating profit margin, as a percentage of revenues, for the segment in the second quarter was 29.7%, down from 30.5% in the year-ago quarter.

Margin Details

Adjusted gross margin, as a percentage of revenues, was 48.8% in the quarter, down 10 basis points (bps) year over year. The downside was a result of an impact of acquisitions and divestitures completed in 2016.

Adjusted selling, general & administrative (SG&A) expenses, as a percentage of revenues, were 24.4%, down 100 bps from the year-ago quarter.

Research and Development (R&D) expenses, as a percentage of revenues, rose 20 bps in the quarter to $33.5 million.

As a result, the company’s overall adjusted operating margin from continuing operations came in at 18.2% of net revenues and rose 70 bps on a year-over-year basis.

 

PerkinElmer, Inc. Price, Consensus and EPS Surprise

 

PerkinElmer, Inc. Price, Consensus and EPS Surprise | PerkinElmer, Inc. Quote

Financial Details

 

For the first half of 2017, PerkinElmer’s operating cash flow from continuing operations was $95.6 million, as compared with $107.4 million in the prior-year period. The company finished the quarter with approximately $1.1 billion in debt.

Guidance Raised

The company revised its adjusted earnings guidance for full-year 2017. PerkinElmer now expects adjusted earnings per share in the band of $2.84 and $2.92, up from the previously provided range of $2.80 and $2.90.

Key Picks

PerkinElmer has a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader medical sector include Edwards Lifesciences Corporation (EW - Free Report) , Abiomed Inc. (ABMD - Free Report) and Dextera Surgical Inc. (DXTR - Free Report) .

Notably, Edwards Lifesciences sports a Zacks Rank #1 (Strong Buy), while Abiomed and Dextera have a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.2%. Notably, the stock has a return of 3.4% over the last three months.

Abiomed yielded a strong return of 20.6% over the last one year. The stock has a long-term expected earnings growth rate of 30.5%.

Dextera has a projected sales growth of 54.8% for the current year. The stock promises a long-term expected earnings growth rate of 25%.

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