Acquisition lifts Agilent

Article Excerpt

AGILENT TECHNOLOGIES INC. $138 is a buy. The company (New York symbol A; Aggressive Growth Portfolio, Manufacturing sector; Shares outstanding: 285.2 million; Market cap: $39.4 billion; Price-to-sales ratio: 6.0; Dividend yield: 0.7%; TSINetwork Rating: Average; www.agilent.com) makes specialized testing equipment for medical research laboratories and industrial clients. In September 2024, the firm paid $925 million for Biovectra, a Canadian business that helps drug developers research and manufacture their products. That purchase helped lift Agilent’s revenue in its fiscal 2024 fourth quarter, ended October 31, 2024, by 0.8%, to $1.70 billion from $1.69 billion a year earlier. Earnings rose 3.5%, to $418 million from $404 million. Due to fewer shares outstanding, per-share earnings gained 5.8%, to $1.46 from $1.38. Agilent’s earnings in fiscal 2025 will probably rise about 5% to $5.58 a share, and the stock trades at 24.7 times that forecast. That’s a reasonable multiple as the company spends a high 7% of its revenue on research. As well, with the January 2025 payment, Agilent will…