As the Q1 earnings season wraps, let's dig into this quarter's best and worst performers in the inspection instruments industry, including Teledyne (NYSE:TDY) and its peers.
Measurement and inspection instrument companies may enjoy more steady demand because products such as water meters are non-discretionary and mandated for replacement at predictable intervals. In the last decade, digitization and data collection have driven innovation in the space, leading to incremental sales. But like the broader industrials sector, measurement and inspection instrument companies are at the whim of economic cycles. Interest rates, for example, can greatly impact civil, commercial, and residential construction projects that drive demand.
The 6 inspection instruments stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 2.4%. while next quarter's revenue guidance was 2.6% below consensus. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and while some of the inspection instruments stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.6% on average since the previous earnings results.
Weakest Q1: Teledyne (NYSE:TDY) Playing a role in mapping the ocean floor as we know it today, Teledyne (NYSE:TDY) offers digital imaging and instrumentation products for various industries.
Teledyne reported revenues of $1.35 billion, down 2.4% year on year, falling short of analysts' expectations by 3.1%. It was a weak quarter for the company, with a miss of analysts' organic revenue estimates and underwhelming earnings guidance for the full year.
“We achieved record first quarter non-GAAP operating margin, adjusted earnings per share and free cash flow,” said Robert Mehrabian, Executive Chairman.
Teledyne delivered the weakest performance against analyst estimates of the whole group. The stock is down 4.9% since the results and currently trades at $387.28.
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Best Q1: Badger Meter (NYSE:BMI) The developer of the world’s first frost-proof water meter in 1905, Badger Meter (NYSE:BMI) provides water control and measure equipment to various industries.
Badger Meter reported revenues of $196.3 million, up 23.4% year on year, outperforming analysts' expectations by 7.7%. It was a stunning quarter for the company, with revenue and EPS exceeding analysts' estimates.
Badger Meter pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is up 23.2% since the results and currently trades at $188.68.
Keysight (NYSE:KEYS) Spun off from Hewlett-Packard in 2014, Keysight (NYSE:KEYS) offers electronic measurement products for use in various sectors.
Keysight reported revenues of $1.22 billion, down 12.5% year on year, exceeding analysts' expectations by 1%. It was a weaker quarter for the company, with a miss of analysts' backlog sales estimates.
Keysight had the slowest revenue growth in the group. The stock is down 15.4% since the results and currently trades at $135.33.
FARO (NASDAQ:FARO) Launched by two PhD students in a garage, FARO (NASDAQGS:FARO) provides 3D measurement and imaging systems for the manufacturing, construction, engineering, and public safety industries.
FARO reported revenues of $84.24 million, down 0.9% year on year, surpassing analysts' expectations by 3.9%. It was a solid quarter for the company, with a decent beat of analysts' earnings estimates.
The stock is down 13.9% since the results and currently trades at $16.29.
Itron (NASDAQ:ITRI) Founded by a small group of engineers who wanted to build a more efficient way to read utility meters, Itron (NASDAQGS:ITRI) offers energy and water management products for the utility industry, municipalities, and industrial customers.
Itron reported revenues of $603.4 million, up 22% year on year, surpassing analysts' expectations by 4.2%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates.
The stock is up 8.7% since the results and currently trades at $99.47.
This content was originally published on Stock Story
