AMETEK's (AME) Q3 Earnings Surpass Estimates, Sales Up Y/Y
AMETEK, Inc. AME reported third-quarter 2023 adjusted earnings of $1.64 per share, beating the Zacks Consensus Estimate by 3.8%. The bottom line rose 13.1% on a year-over-year basis.
Net sales of $1.62 billion lagged the Zacks Consensus Estimate by 1.5%. The top line increased 4.6% year over year.
Top-line growth was driven by solid momentum across the Electronic Instruments segment.
AME shares have gained 0.3% year to date, underperforming the Zacks Computer & Technology sector’s increase of 29.8%.
Operating Details
Electronic Instruments (70% of sales) sales of $1.14 billion increased 7.8% year over year. The figure topped the consensus mark by 0.05%.
AMETEK, Inc. Price
AMETEK, Inc. price | AMETEK, Inc. Quote
The Electromechanical segment (30% of sales) generated $486.7 million in sales in the third quarter, which declined 2.2% on a year-over-year basis. The figure lagged the Zacks Consensus Estimate by 4.2%.
For the third quarter, operating expenses were $1.18 billion, up 1.5% year over year. The figure contracted 220 basis points (bps) year over year 73%.
Consequently, the operating margin was 27%, which expanded 220 bps from the year-ago quarter’s figure.
The operating margin for Electronic Instruments expanded 360 bps year over year to 29.5%. The Electromechanical segment’s operating margin contracted 120 bps on a year-over-year basis to 26.2%.
Balance Sheet
As of Sep 30, 2023, cash and cash equivalents were $841.9 million, up from $605.6 million as of Jun 30, 2023.
Long-term debt was $1.86 billion as of Sep 30, 2023, up from $2.19 billion as of Jun 30, 2023.
Operating cash flow jumped 45% year over year to a record $473 million in the third quarter.
Guidance
For fourth-quarter 2023, AMETEK expects sales growth in the mid-single digits year over year. The Zacks Consensus Estimate for fourth-quarter sales is pegged at $1.72 billion, indicating growth of 5.67%.
AMETEK expects adjusted earnings of $1.61-$1.63 per share, suggesting growth of 6-7% from the year-ago quarter’s reported number. The consensus mark for the same is pinned at $1.62 per share, unchanged over the past 30 days.
For 2023, AME expects sales growth in the mid to high-single digits from the 2022 level. The Zacks Consensus Estimate for 2023 sales is pegged at $6.61 billion, indicating growth of 7.46%.
AMETEK expects adjusted earnings between $6.31 and $6.33 per share, suggesting growth of 11% from the 2022 reported level. The Zacks Consensus Estimate for earnings is pegged at $6.26 per share, unchanged over the past 30 days.
Zacks Rank & Other Stocks to Consider
AMETEK currently carries a Zacks Rank #2 (Buy).
eGain EGAN, GoDaddy GDDY and Itron ITRI are some other top-ranked stocks that investors can consider in the broader sector, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
eGain shares have declined 33.9% year to date. EGAN is set to report its first-quarter fiscal 2024 results on Nov 2.
GoDaddy shares have declined 3.3% year to date. GDDY is set to report its third-quarter 2023 results on Nov 2.
Itron shares have returned 12.2% year to date. ITRI is set to report its third-quarter 2023 results on Nov 2.
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