Agilent Technologies is set to unveil its financial performance for the third quarter of fiscal year 2024 on August 21st. The company anticipates a revenue range of $1.535 billion to $1.575 billion, indicating a decline of 8.2% to 5.8% on a reported basis and 6.9% to 4.5% on a core basis compared to the same period last year. The Zacks Consensus Estimate for revenue stands at $1.56 billion, reflecting a 6.6% decrease from the previous year.
In terms of earnings, Agilent projects non-GAAP earnings per share to fall between $1.25 and $1.28. The Zacks Consensus Estimate for earnings is pegged at $1.25 per share, implying a 12.6% drop from the comparable quarter of the prior year. This estimate has been revised downwards by 0.8%.
Several key factors are expected to influence Agilent’s performance in the third quarter. The company is poised to benefit from the continued growth of its Agilent Cross Lab Group (ACG) segment, driven by strong momentum across end markets and various geographic regions. The ACG segment is likely to be boosted by the strength of services attached to new instrument installations and existing instrument bases. Growing lab demand, coupled with the solid performance of the CrossLab team, is anticipated to contribute positively.
The Zacks Consensus Estimate for ACG is pegged at $410 million, indicating a 3.5% increase from the prior year’s corresponding quarter.
Agilent’s strength in the pathology business, fueled by robust clinical demand for its Cancer Dx platform, is expected to have continued to benefit the performance of the Diagnostics and Genomics Group (DGG) segment in the third quarter. However, challenges in NGS Chemistries, cell analysis, and NASD could create concerns.
The Zacks Consensus Estimate for DGG is set at $405 million, representing a 16% growth from the same quarter in the previous year.
Meanwhile, the Life Sciences & Applied Markets Group (LSAG) segment is anticipated to face headwinds due to weakening momentum. Macroeconomic uncertainties, soft market conditions in China, and sluggish capital spending by customers are expected to have negatively impacted the segment during the third quarter.
The Zacks Consensus Estimate for LSAG is pegged at $755 million, signifying an 18.6% decline from the comparable quarter last year.
While Agilent has exceeded the Zacks Consensus Estimate in each of the past four quarters, averaging a 4.13% beat, the current model does not definitively predict an earnings beat for this quarter. According to the Zacks model, a positive Earnings ESP and a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the probability of an earnings beat. However, Agilent currently holds a Zacks Rank #4 (Sell) and an Earnings ESP of -1.46%, which does not align with the model’s criteria for an earnings beat.
Investors seeking alternative stocks with a greater likelihood of exceeding earnings expectations can consider the following:
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