Revvity (RVTY) Down 4.9% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Revvity (RVTY). Shares have lost about 4.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Revvity due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Revvity Beats on Q2 Earnings, Lowers ‘23 EPS View
Revvity reported second-quarter 2023 adjusted earnings per share (EPS) of $1.21, which beat the Zacks Consensus Estimate of $1.18 by 2.5%. The bottom line, however, declined 38.9% from the year-ago quarter’s level.
GAAP EPS from continuing operations came in at 47 cents compared with $1.28 in the prior-year period. However, GAAP EPS was 28 cents, including a loss of 18 cents per share from discontinued operations.
Revenue Details
Based in Waltham, MA, this leading MedTech company reported revenues of $709.1 million, down 20.8% year over year and 20% organically. However, the metric was up 6% organically after excluding sales from COVID products. The top line beat the Zacks Consensus Estimate by 0.6%.
Segment Details
Revvity reports under two operating segments — Life Sciences and Diagnostics.
Life Sciences
Revenues at this segment totaled $336.4 million, indicating an increase of 3% from the year-ago quarter’s level. Organically, the segment witnessed an improvement of 3%.
Adjusted operating income amounted to $127.8 million, up 2.2% from that recorded in the prior-year quarter.
Diagnostics
This segment’s revenues totaled $372.9 million, down 34.5% on a year-over-year basis. Organically, the top line decreased 34%. Excluding COVID-related sales, sales were up 8% organically.
Adjusted operating income amounted to $85.2 million, down 65.2% from the year-ago quarter’s figure.
Margin Analysis
Selling, general and administrative expenses totaled $267 million, up 1.5% year over year. Research and development expenses amounted to $57.3 million, up 2.2% from the year-ago quarter’s number.
Adjusted operating income declined 42.4% to $204.3 million from the year-ago quarter’s level. Adjusted operating margin, as a percentage of revenues, was 28.8%, down 1080 bps.
Financial Update
The company exited the second quarter with cash and cash equivalents of $2.07 billion compared with $2.27 billion in the year-ago period.
Net cash used in operating activities, including discontinued operations, totaled $135.3 million against net cash provided by operating activities of $97.5 million in the year-ago quarter.
2023 Guidance
Revvity provided updated earnings and revenue guidance for full-year 2023.
For 2023, the company now expects adjusted EPS in the range of $4.70-$4.90 compared with the previous guidance of $4.85-$5.05. Revenues are anticipated in the band of $2.80-$2.85 billion compared with the previous projection of $2.90-$2.94 billion. The Zacks Consensus Estimate for EPS and sales is pegged at $4.94 per share and $2.92 billion, respectively.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -5.83% due to these changes.
VGM Scores
At this time, Revvity has a poor Growth Score of F, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Revvity has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Revvity belongs to the Zacks Medical Services industry. Another stock from the same industry, Avantor, Inc. (AVTR), has gained 5.1% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Avantor, Inc. reported revenues of $1.74 billion in the last reported quarter, representing a year-over-year change of -8.7%. EPS of $0.28 for the same period compares with $0.37 a year ago.
For the current quarter, Avantor, Inc. is expected to post earnings of $0.25 per share, indicating a change of -26.5% from the year-ago quarter. The Zacks Consensus Estimate has changed -6.7% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Avantor, Inc. Also, the stock has a VGM Score of C.
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Revvity Inc. (RVTY) : Free Stock Analysis Report
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