Ametek AME reported better-than-expected results for third-quarter 2024. AME reported adjusted earnings (non-GAAP) of $1.66 per share, which surpassed the Zacks Consensus Estimate by 2.5%. The figure increased 1.2% from the year-ago period.
AME’s third-quarter 2024 revenues were $1.71 billion, which increased 5% from the year-ago quarter. The figure surpassed the consensus mark of $1.69 billion. The top-line growth can be attributed to the strong performance across the Electromechanical Group (EMG) and Electronic Instruments Group (EIG) segments supported by a better-than-expected operational performance.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Ametek’s overall performance in the third quarter was steered by a strong portfolio combined with operational excellence and efforts in product development and acquisitions.
Looking forward, Ametek provided top-line guidance for the fourth quarter, which is above the Zacks Consensus Estimate. The company’s better-than-expected third-quarter performance, along with an impressive fourth-quarter outlook, is likely to attract investors. Shares of AME have risen 11.2% year to date, outperforming the Zacks Electronics - Testing Equipment industry’s decline of 0.5%.
AMETEK, Inc. Price, Consensus and EPS Surprise
AMETEK, Inc. price-consensus-eps-surprise-chart | AMETEK, Inc. Quote
Ametek’s Q3 2024 Details
EIG sales (66.5% of total revenue) in the third quarter were $1.135 billion, in line with the year-ago quarter’s reported figure and the Zacks Consensus Estimate.
In the third quarter, revenues from EMG (33.5% of total revenues) were $574 million, up 18% from the year-ago quarter. The figure surpassed the consensus mark of $555 million.
For the third quarter, operating income increased 2% year over year to $445.9 million and operating margin contracted by 90 basis points (bps) from the year-ago quarter.
EIG’s operating income in the quarter increased 1% to $339 million with operating income margins of 29.9%, reflecting an increase of 40 bps from the year-ago reported figure.
EMG's third-quarter operating income was $131.5 million, up 3% compared with the year-ago period, while operating income margins were 22.9% in the quarter.
AME’s Balance Sheet & Cash Flow
As of Sept. 30, 2024, AME had cash and cash equivalents of $396.3 million compared with the previous quarter’s figure of $396.6 million.
As of Sept. 30, 2024, the long-term debt declined 3.2% to $1.77 billion from the previous quarter’s levels.
Operating cash flow in the third quarter was $487.2 million, up 3% compared with the prior year, with free cash flow to net income conversion of 135%.
AME Updates Guidance
For the fourth quarter, management expects sales to be up in the mid-single digits percentage basis from the year-ago quarter’s reported figure. The Zacks Consensus Estimate is pegged at $1.78 billion, reflecting a year-over-year increase of 3.1%.
AMETEK expects adjusted earnings to be in the band of $1.81-$1.86 per share, suggesting an increase of 8-11% compared with the prior-year quarter. The consensus mark is pinned at $1.82 per share.
For 2024, AME still expects sales growth between 5% and 7% from the 2023 reported level. The Zacks Consensus Estimate is pegged at $6.95 billion.
The company increased its guidance for adjusted earnings per share from $6.70-$6.80 to $6.77-$6.82, suggesting growth of 6-7% from the 2023 reported level. The Zacks Consensus Estimate for earnings is pegged at $6.76 per share, indicating a year-over-year increase of 6%.
Zacks Rank & Stocks to Consider
Currently, AME carries a Zacks Rank #4 (Sell) at present.
Arista Networks ANET, Autodesk ADSK and Lyft LYFT are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector.
Arista Networks, Autodesk and Lyft each sports a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arista Networks’ shares have gained 64.1% year to date. ANET is set to report its third-quarter 2024 results on Nov. 7.
Autodesk shares have risen 16.6% year to date. ADSK is set to report its third-quarter fiscal 2025 results on Nov. 19.
LYFT shares have lost 13.4% year to date. LYFT is set to report its third-quarter 2024 results on Nov. 6.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners UpAMETEK, Inc. (AME) : Free Stock Analysis Report
Autodesk, Inc. (ADSK) : Free Stock Analysis Report
Arista Networks, Inc. (ANET) : Free Stock Analysis Report
Lyft, Inc. (LYFT) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
