Markets
AVT

Will New Technologies Benefit Agilent (A) in Q3 Earnings?

Agilent TechnologiesA is set to report fiscal third-quarter 2018 results on Aug 14. In the last reported quarter, the company delivered in-line results.

The company's surprise history has been pretty impressive. It beat estimates in three of the trailing four quarters, with an average positive earnings surprise of 8.40%.

Notably, on a 12-month basis, Agilent's shares have returned 15%, underperforming the industry 's rally of 19.1%.

Let's see how things are shaping up for this announcement.

Strength in ACG Segment to Drive Revenues

In the last reported quarter, revenues from the Agilent Cross Lab Group (ACG) came in at $426 million. Both services and consumables witnessed growth. Food led growth across all regions and major end-markets.

The figure is expected to further increase in the to-be-reported quarter, driven by strength in services and consumables across all geographical regions. The Zacks Consensus Estimate for the quarter to be reported is pegged at $430 million.

Strength in DGG & LSAG Serves as a Big Positive

In the last reported quarter, revenues from the company's Diagnostics and Genomics Group (DGG) came in at $219 million, up year over year driven by strength in pharma, diagnostic and clinical end-markets. All businesses under this group (Dako, Genomics and Nucleic Acid Solutions) performed well. The segment is also expected to perform well in the soon-to-be-reported quarter. The Zacks Consensus Estimate for the fiscal third quarter is pegged at $220 million.

The Life Sciences & Applied Markets Group (LSAG) segment is expected to perform well in the quarter, driven by strong performances in chemical and energy, as well as pharma and environmental markets. The Zacks Consensus Estimate for the fiscal third quarter is pegged at $570 million.

Other Growth Drivers

Agilent is a broad-based OEM of test and measurement equipment. The company shifted its focus to life sciences, genomics, diagnostics and wireless test markets, in which it has made a few important acquisitions, and alliances.

Agilent's broad-based portfolio and increased focus on its segments offer higher growth potential. The company's decision to divest/wind up underperforming businesses has enhanced its focus on the new Agilent, while enabling expansion of a solid recurring revenue base, and diversification of geographic and industrial operations for growth. Also, the company's focus on aligning investments toward more attractive growth avenues and innovative product launches is a positive.

What Our Model Suggests

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP .

Zacks Rank #4 (Sell) or 5 (Strong Sell) stocks are best avoided, especially if these have a negative Earnings ESP. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Agilent has a Zacks Rank #2 and an Earnings ESP of +1.15%, a combination suggests that the company is likely to beat estimates this time around.

Agilent Technologies, Inc. Price and EPS Surprise

Agilent Technologies, Inc. Price and EPS Surprise | Agilent Technologies, Inc. Quote

Other Stocks to Consider

In addition to Agilent, we see a likely earnings beat for each of the following companies:

Vishay Intertechnology, Inc. VSH has an Earnings ESP of +4.52% and sports a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .

Avnet, Inc. AVT has an Earnings ESP of +1.37% and a Zacks Rank #2.

Applied Materials AMAT has an Earnings ESP of +0.95% and a Zacks Rank #3.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Avnet, Inc. (AVT): Free Stock Analysis Report

Vishay Intertechnology, Inc. (VSH): Free Stock Analysis Report

Applied Materials, Inc. (AMAT): Free Stock Analysis Report

Agilent Technologies, Inc. (A): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

AVT A VSH AMAT

Other Topics

Earnings Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More