top of page

Is Agilent a buy?

It’s time to talk about a healthcare name. Here is the breakdown on $A, otherwise known as Agilent.

Current Price: $117.64

52/Wk High: $120.24

52/Wk Low: $61.13

Market Cap: $36.1 Billion

Dividend: $0.78 / 0.66% Yield

Read below for the breakdown!

Agilent is a major healthcare equipment and supplies company that provides digital solutions focused on the workflow of laboratories.

Agilent Technologies is focused on three core segments within its business; Life Sciences and applied markets, Agilent CrossLabs, and finally genomics and diagnostics.

In recent news, Agilent received FDA approval last month for their diagnostic test, which identifies aggressive breast cancer of patients.

Not only that, but Agilent also entered into a partnership with InterVenn, a private biosciences company that should benefit Agilent in the long run.

Shifting into the numbers Agilent reported a solid Q4 and outlook for 2021. Agilent beat Q4 expectations with an EPS of $0.98, much better than the analyst’s EPS consensus estimate of $0.93.

Agilent also reported 8% growth in revenues throughout Q4, bringing the fourth quarters revenues to $1.48 billion. As for net income (GAAP basis) the total was $222 million, much better than the net income in Q4 2019 of $194 million.

Breaking the numbers down by segment the company’s Life Sciences and Applied Markets segment saw Q4 revenues of $671 million, and an increase of 8%.

Agilent’s Cross Lab segment also posted revenue gains, reporting Q4 revenues of $518 million, representing total revenue growth of 9% year over year within the segment.

Lastly, Agilent’s Diagnostics and Genomics segment delivered Q4 revenues of $294 million, totaling 9% growth within the segment year over year.

As for the full year, Agilent reported revenues of $5.34 billion in 2020, representing 3% growth throughout the year. The company also reported a GAAP net income of $719 billion as well, down 32% from 2019.

Taking a look at 2021, Agilent management expects FY 2021 revenues to total $5.6 billion to $5.7 billion, representing 4.5% to 5.5% growth in revenues throughout the year. Revenues for Q1 of 2021 are expected to increase to a range of $1.42 billion to $1.43 billion.

Management is positive about the future.

While there is still some uncertainty looking forward, we are well-positioned to pursue our successful growth strategy well into the future,” CEO Mike McMullen said.

Shifting into the balance sheet the numbers are solid.

Total Debt: $2.359 billion

Total Liabilities: $4.754 billion

Total Assets: $9.627 billion

Cash & Short Term Inv: $1.441 billion

Valuation has gotten a little expensive as the company has continued to deliver.

Price to Earnings: 50.95x

Price to Sales: 6.74x

Price to Book: 7.37x

Price to Cash Flow: 30.12x

Management has also done a solid job as of recently.

Return on Equity: 14.95%

Return on Assets: 7.54%

Return on Invested Capital: 9.26%

Given the numbers the analysts are bullish with the mean price target sitting at $123.70/share, representing a 5.17% upside.

It is also important to note that the high price target is $132.00/share, representing a 12.23% gain, while the low price target is $117.00/share, representing a -0.53% loss.

The big money is quite involved with 88.68% of Agilent being owned by institutions. Top holders include The Vanguard Group, T. Rowe Price Associates, and BlackRock Institutional Trust.

On a technical basis, Agilent is neutral. According to the six-month charts the MACD has just turned to the downside with minimal momentum around 2.12.

The six-month charts are also indicating an RSI of 59.07 and CCI of 46.37, both of which are in more of a neutral range.

In short, Agilent is a solid long term pick given projected growth, consistent returns, and a growing market.


Disclaimer: This is not direct financial advice, simply an opinion based on independent research.

bottom of page