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Here's Why Agilent Technologies Rose as Much as 10.8% Today

By Maxx Chatsko - Aug 15, 2019 at 2:49PM

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The lab hardware company reported fiscal third-quarter 2019 operating results.

What happened

Shares of Agilent Technologies (A 0.77%) jumped nearly 11% after the company reported fiscal third-quarter 2019 operating results. The business exceeded its own expectations and those on Wall Street. While the life sciences and applied markets group (LSAG) continued to struggle, the company's two other segments each delivered year-over-year revenue growth of at least 10%.

The surprisingly good quarter prompted management to raise its fiscal full-year 2019 guidance for revenue and adjusted earnings per share (EPS). It continues a dizzying string of revisions. Agilent Technologies issued initial guidance in November 2018, increased expectations in February, lowered them in May, and now increased them again this month.

As of 2:33 p.m. EDT, the stock had settled to a 6.6% gain.

A man looks at his laptop as cash money falls around him.

Image source: Getty Images.

So what

The laboratory hardware leader reported fiscal Q3 2019 revenue of $1.27 billion, representing a 6% increase from the year-ago period, and adjusted EPS of $0.76. Both metrics beat the average analyst expectation of $1.24 billion in quarterly sales and $0.72 in adjusted EPS compiled by Yahoo! Finance. None of the 15 estimates thought the business would top $1.25 billion in revenue or $0.75 in adjusted earnings for the most recent three-month period.

Agilent Technologies rode year-over-year increases of 10% and 13%, respectively, for its CrossLab segment and diagnostics and genomics segment. The LSAG managed just 1% growth in that span. Management is looking to combat the company's weakness in global life sciences, caused primarily by customer churn between small-molecule drug research (declining) and biopharma research (increasing), through the acquisition of BioTek Instruments. If the transaction closes, it will significantly expand the industry leader's presence in cell analysis, an increasingly important approach in generating valuable biological data.

Now what

Management now expects fiscal full-year 2019 revenue of at least $5.105 billion and adjusted EPS of at least $3.07, up from the most recent expectations calling for at least $5.085 billion in sales and adjusted earnings of at least $3.03. While the revenue outlook meets the average expectation on Wall Street, the earnings outlook beats the average analyst estimate by a penny. Hardly earthshaking stuff, but the solid performance is all the more surprising following weaker-than-expected quarterly results from a number of lab hardware peers. Agilent Technologies has managed to navigate global headwinds just a bit better and expects that momentum to continue for at least another quarter.

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