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Will Agilent Technologies' Earnings Really Fall 45% YoY?

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Why Agilent Technologies (A) Stock Might be a Great Pick

Shares of Agilent Technologies Inc (NYSE: A) are surging on Monday afternoon, in advance of the announcement of the company’s second quarter financial results, to be reported after the market closes.

According to Estimize, the company, the Street and the crowd all expect a marked year-over-year decline in both earnings and revenue.

In the second quarter of 2014, Agilent registered earnings of $0.72 per share, in line with consensus, and revenue of $1.731 billion. For the current quarter, the company guided earnings of $0.39 per share on revenue of $995 million.

The Street expects earnings in line with guidance, on slightly lower revenue of $993 million. Meanwhile, the crowd is marginally less bearish, and projects earnings of $0.40 on revenue of $996.15 million.

It should be noted from the chart overhead that the company tends to either meet or beat the Street’s estimates, while missing the crowd’s consensus.

As it can be seen in the table above, the current quarter is expected to be the worst in –- at least -- two years.

The New Agilent

In a recent article published on Zacks, analysts rated the stock a Hold, noting that Agilent’s decision to divest its underachieving business is working in its advantage. They conclude that the increased focus on the new business is thus helping it to generate additional revenue.

“On the profitability side, it’s worth noting that Agilent continues to announce a steady flow of new products with higher margins,” the note explains. “The new product strategy is now being supplemented with the multi-year ‘Agile Agilent’ Program, which will enable it to increase efficiency and customer focus.”

Zacks expects earnings in the range of $0.37 to $0.41 per share, and revenue of $985 million to $1.01 billion.

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