Why Brooks Automation, Inc's Shares Popped 19% Today

A great earnings report could be a sign of good things to come for investors.

Travis Hoium
Travis Hoium
Feb 2, 2017 at 4:49PM
An item being put into cold storage.

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What happened

Shares of Brooks Automation, Inc (NASDAQ:BRKS) jumped as much as 18.6% on Thursday after reporting fiscal first-quarter 2017 earnings. At 3 p.m. EST shares were still up 14.8% on the day.

So what

Revenue rose 33.3% in the quarter to $160 million and the company swung from a net loss of $4.6 million to net income of $13.9 million. Adjusted for one-time items, earnings were $0.25 per share, $0.05 ahead of expectations. 

For the fiscal second-quarter, management expects revenue of $165 million to $170 million and earnings of $0.24 to $0.27 per share. This compares to Wall Street's expectation of $159 million in revenue and $0.22 per share in earnings, so the company is definitely exceeding what investors had priced in.

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Now what

Both semiconducturs and life sciences are doing well and that's why revenue has grown so broadly over a year ago. The Life Sciences business was a strength with $33.3 million in revenue and bookings doubling from a year ago, so that's an area we can likely expect more growth in the future. 

Given the current forward P/E ratio and the level Brooks Automation is beating expectations, I think the stock has further to run. Bookings are strong and margins are improving and with life sciences' potential as a growth business this is a strong stock for investors long term.