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PerkinElmer (PKI) Up 6.4% Since Last Earnings Report: Can It Continue?

·4-min read

It has been about a month since the last earnings report for PerkinElmer (PKI). Shares have added about 6.4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is PerkinElmer due for a pullback? 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.

PerkinElmer Q3 Earnings and Revenues Surpass Estimates

PerkinElmer, Inc. reported third-quarter 2021 adjusted earnings per share of $2.31, which beat the Zacks Consensus Estimate of $1.70 per share by 35.9%. The bottom line improved 10.5% from the year-ago quarter.

GAAP earnings per share in the quarter was $1.11, compared with the year-ago quarter’s figure of $1.57.

Revenue Details

Based in Waltham, MA, this leading MedTech company reported revenues of $1.17 billion, up 21% from the year-ago quarter and 12% organically. The top line surpassed the Zacks Consensus Estimate by 16.2%.

Segment Details

Discover & Analytics Solutions

At this segment, revenues were $513 million, reflecting a rise of 21% from the year-ago quarter. Organically, the segment witnessed an increase of 10% in the quarter under review.

Coming to profits at the DAS segment, the company reported second-quarter 2021 adjusted operating income of $95 million, up 53.2% from the year-ago quarter.

Diagnostics segment

Revenues at this segment amounted to $654 million, up 21% on a year-over-year basis. Organically, the segment increased 13% in the third quarter.

Adjusted operating income in the segment totaled $287 million, up 10.4% from the year-ago quarter.

Margin Analysis

Adjusted gross profit in the quarter amounted to $673.5 million, up 23.7% year over year. Adjusted gross margin, as a percentage of revenues was 57.7%, up 120 basis points (bps) year over year.

Selling, general and administrative expenses were $339 million, up 50.5% on a year-over-year basis. Research and development expenses amounted to $68.6 million, up 36.9% from the year-ago quarter.

Adjusted operating income was $358.9 million, which climbed 17.9% from the year-ago quarter. Adjusted operating margin, as a percentage of revenues, was 30.8%, down 80 bps.

Financial Update

The company exited the third quarter with cash and cash equivalents of $487.4 million, compared with $572.8 million in the prior quarter.

Cumulative net cash provided by operating activities for the third quarter totaled $1.08 billion, compared with $410.1 million in the year-ago period.

2021 Guidance

PerkinElmer has provided guidance for fourth-quarter 2021 and raised the full-year 2021 outlook.

For fourth-quarter 2021, the company projects adjusted earnings per share of $2.05. The Zacks Consensus Estimate is pegged at $1.71 per share. For the same period, revenues are anticipated to be around $1.2 billion. The Zacks Consensus Estimate for the same stands at $1.03 billion.

For 2021, the company expects adjusted earnings per share to be $10.81 (up from the previous estimate of $9.88). The Zacks Consensus Estimate is pegged at $9.96 per share.

Revenues are anticipated to be $4.9 billion (up from the prior estimate of $4.57 billion). The consensus mark stands at $4.57 billion.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review. The consensus estimate has shifted 20.92% due to these changes.

VGM Scores

Currently, PerkinElmer has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, PerkinElmer has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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