We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
AMETEK (AME) Q3 Earnings Beat Estimates, Revenues Up Y/Y
Read MoreHide Full Article
AMETEK, Inc. (AME - Free Report) reported third-quarter 2019 adjusted earnings of $1.06 per share, which beat the Zacks Consensus Estimate by 5 cents and also surpassed management’s guidance of $1.00-$1.02. The figure improved 16.5% from the year-ago quarter and 0.9% sequentially.
Net sales improved 7% on a year-over-year basis but declined 0.9% sequentially to $1.28 billion. The figure fell short of the Zacks Consensus Estimate of $1.29 billion.
Robust organic growth and contributions from acquisitions drove year-over-year top-line improvement. Further, improved operational activities and strong segmental performance aided results.
We believe that the company’s proper execution of the four core growth strategies of operational excellence, global market expansion, investments in product development and acquisitions are expected to continue benefiting business growth in the near term as well as the long haul.
Top Line in Detail
AMETEK reports sales under two organized segments — Electronic Instruments Group (EIG) and Electromechanical Group (EMG).
EIG (63.9% of total sales): The company generated $815.6 million of sales from this segment, reflecting growth of 10% from the year-ago quarter. The benefits from acquisitions of Forza, Telular and Spectro Scientific drove year-over-year growth in this segment. Further, organic sales in the reported quarter remained positive in this segment.
EMG (36.1% of sales): This segment generated $461.1 million of sales in the first quarter, which improved 2.3% on a year-over-year basis. The segment’s top-line growth can primarily be attributed to solid organic sales growth and positive contributions from the Pacific Design Technologies buyout.
For the third quarter, operating margin was 23.6%, which expanded 140 bps from the year-ago quarter figure.
Segment wise, operating margins for EIG and EMG were 26.9% and 22.4 %, expanding 130 bps and 180 bps, respectively, on a year-over-year basis.
Operating expenses were $975.6 million, up 5.2% year over year. However, the figure contracted 140 bps from the year-ago quarter as a percentage of net sales.
Balance Sheet
As of Sep 30, 2019, cash and cash equivalents were $735.4 million, up from $567.9 million as of Jun 30, 2019.
Long-term debt was $2.2 billion, down from $2.4 billion in the previous quarter.
Guidance
For fourth-quarter 2019, AMETEK expects sales to improve by a mid-single digit on a year-over-year basis. The Zacks Consensus Estimate for sales is pegged at $1.33 billion.
Earnings are anticipated to be $1.01-$1.03 per diluted share, reflecting year-over-year growth of 5-7%. The Zacks Consensus Estimate for earnings is projected at $1.03.
For 2019, the company anticipates total sales to improve in the range of mid to high-single digits from 2018. Further, organic sales growth is projected at 3%. AMETEK also anticipates benefiting from acquisition contributions. The Zacks Consensus Estimate is pegged at $5.20 billion.
Further, AMETEK revised guidance upward for adjusted earnings per share from $4.04-$4.10 to $4.12-$4.14, reflecting growth of 13% from 2018. The Zacks Consensus Estimate for 2019 earnings is pegged at $4.10.
Long-term earnings growth rate for NetEase, Itron and Five9 is currently pegged at 31.93%, 25% and 10%, respectively.
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our just-released Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
Image: Bigstock
AMETEK (AME) Q3 Earnings Beat Estimates, Revenues Up Y/Y
AMETEK, Inc. (AME - Free Report) reported third-quarter 2019 adjusted earnings of $1.06 per share, which beat the Zacks Consensus Estimate by 5 cents and also surpassed management’s guidance of $1.00-$1.02. The figure improved 16.5% from the year-ago quarter and 0.9% sequentially.
Net sales improved 7% on a year-over-year basis but declined 0.9% sequentially to $1.28 billion. The figure fell short of the Zacks Consensus Estimate of $1.29 billion.
Robust organic growth and contributions from acquisitions drove year-over-year top-line improvement. Further, improved operational activities and strong segmental performance aided results.
We believe that the company’s proper execution of the four core growth strategies of operational excellence, global market expansion, investments in product development and acquisitions are expected to continue benefiting business growth in the near term as well as the long haul.
Top Line in Detail
AMETEK reports sales under two organized segments — Electronic Instruments Group (EIG) and Electromechanical Group (EMG).
EIG (63.9% of total sales): The company generated $815.6 million of sales from this segment, reflecting growth of 10% from the year-ago quarter. The benefits from acquisitions of Forza, Telular and Spectro Scientific drove year-over-year growth in this segment. Further, organic sales in the reported quarter remained positive in this segment.
EMG (36.1% of sales): This segment generated $461.1 million of sales in the first quarter, which improved 2.3% on a year-over-year basis. The segment’s top-line growth can primarily be attributed to solid organic sales growth and positive contributions from the Pacific Design Technologies buyout.
AMETEK, Inc. Price, Consensus and EPS Surprise
AMETEK, Inc. price-consensus-eps-surprise-chart | AMETEK, Inc. Quote
Operating Details
For the third quarter, operating margin was 23.6%, which expanded 140 bps from the year-ago quarter figure.
Segment wise, operating margins for EIG and EMG were 26.9% and 22.4 %, expanding 130 bps and 180 bps, respectively, on a year-over-year basis.
Operating expenses were $975.6 million, up 5.2% year over year. However, the figure contracted 140 bps from the year-ago quarter as a percentage of net sales.
Balance Sheet
As of Sep 30, 2019, cash and cash equivalents were $735.4 million, up from $567.9 million as of Jun 30, 2019.
Long-term debt was $2.2 billion, down from $2.4 billion in the previous quarter.
Guidance
For fourth-quarter 2019, AMETEK expects sales to improve by a mid-single digit on a year-over-year basis. The Zacks Consensus Estimate for sales is pegged at $1.33 billion.
Earnings are anticipated to be $1.01-$1.03 per diluted share, reflecting year-over-year growth of 5-7%. The Zacks Consensus Estimate for earnings is projected at $1.03.
For 2019, the company anticipates total sales to improve in the range of mid to high-single digits from 2018. Further, organic sales growth is projected at 3%. AMETEK also anticipates benefiting from acquisition contributions. The Zacks Consensus Estimate is pegged at $5.20 billion.
Further, AMETEK revised guidance upward for adjusted earnings per share from $4.04-$4.10 to $4.12-$4.14, reflecting growth of 13% from 2018. The Zacks Consensus Estimate for 2019 earnings is pegged at $4.10.
Zacks Rank & Key Picks
AMETEK currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are NetEase, Inc. (NTES - Free Report) , Itron, Inc. (ITRI - Free Report) and Five9, Inc. (FIVN - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for NetEase, Itron and Five9 is currently pegged at 31.93%, 25% and 10%, respectively.
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our just-released Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
Download Free Report Now >>