Agilent Technologies Inc.
), a broad-based OEM of test and measurement equipment has
authorized the repurchase of shares up to $500 million of the
company's common stock during fiscal 2013.
Additionally, the company also announced its decision to raise
the quarterly dividend by two cents to 12 cents per share. This
translates into a 20% increase from the prior dividend. The
increased dividend will be paid on April 24, 2013, to
stockholders of record on April 24, 2013. Prior to this
announcement, Agilent had been paying a quarterly dividend of 10
cents per share.
The strength of Agilent's business model reflects the
company's commitment toward returning value to shareholders with
its strong cash generation capabilities. We believe that the
continued share buybacks and dividend hike will increase investor
enthusiasm for the shares.
Agilent's strong balance sheet and cash flows provide
financial flexibility in matters of incremental dividend, share
repurchases and accretive acquisitions. During the last concluded
quarter, Agilent spent $94 million on share repurchases and $34
million on dividends. The cash and cash equivalents were $2.4
billion at quarter-end, having increased $0.5 billion during the
quarter. The debt cap ratio was just 28.9%. We remain encouraged
by Agilent's strong cash position and its ability to service its
Agilent reported decent fourth quarter results, with both
revenue and earnings per share surpassing our expectations.
Agilent's leadership position, history of innovation,
strengthening end markets, stable gross margins, steadily
improving operating margins, and position in China are all
positives. The increase in dividend indicates that the company is
confident about its steady cash flows.
However, an uncertain macro conditions, particularly in the
U.S. and Europe and a softer-than-expected earnings guidance
increased concerns regarding near-term performance. Hence,
Agilent has a Zacks Rank #5 (Strong Sell).
However, all companies with testing portfolios are not doing
as bad however. You may consider companies like
Thermo Fisher Scientific, Inc.
) which carry a Zacks Rank #2 (Buy) and
) which carries a Zacks Rank #3 (Hold).
AGILENT TECH (A): Free Stock Analysis Report
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