Mettler-Toledo International MTD shares fell 7.19% to close at $1,310.03 on Nov. 8 following third-quarter 2024 results.
MTD reported third-quarter 2024 adjusted earnings of $10.21 per share, which beat the Zacks Consensus Estimate by 2.1%. The bottom line increased 4.2% on a year-over-year basis.
Net sales of $954.5 million surpassed the Zacks Consensus Estimate of $942 million. The figure rose 1.3% on a reported basis and 1% on a local currency basis from the year-ago quarter.
The softness in the Food Retail and Industrial segments is concerning, especially in contrast to the stronger performance seen in the Laboratory business.
Mettler-Toledo International, Inc. Price, Consensus and EPS Surprise
Mettler-Toledo International, Inc. price-consensus-eps-surprise-chart | Mettler-Toledo International, Inc. Quote
Modest weakening conditions in the Americas region were significant headwinds, whereas growing momentum across Asia/Rest of World and Europe provided a tailwind.
MTD has gained 7.9% compared with the Zacks Computer and Technology sector’s rise of 30.4% in the year-to-date period.
MTD’s Top Line in Detail
MTD reports revenues under three segments, namely Laboratory Instruments, Industrial Instruments and Food Retail, which generated sales of $534.8 million (56% of the net sales), $365.5 million (38.3% of the net sales) and $54.2 million (5.7% of the net sales), respectively, in the third quarter.
The Laboratory segment witnessed year-over-year growth of 5%, while the Industrial and Food Retail segments were flat. The Food Retail segment declined 20% on a local currency basis.
Total sales from the Americas, Europe and Asia/Rest of the World were $393.6 million (41.2% of the net sales), $260 million (27.2%) and $300.9 million (31.5%), respectively.
Sales in Europe and Asia/Rest of World grew 1% and 4% year over year, respectively, on a local currency basis. Meanwhile, Americas sales went down by 1%.
Mettler-Toledo’s Operating Results
The gross margin was 60%, expanding 60 basis points (bps) year over year.
Research & development (“R&D”) expenses were $47.1 million, up 2.1% from the year-ago quarter. Selling, general & administrative (“SG&A”) expenses increased 5.2% year over year to $228.8 million.
As a percentage of sales, R&D expenses were flat year over year at 4.9%. SG&A expenses expanded 90 bps year over year as a percentage of sales.
The adjusted operating margin was 31.1%, which contracted 30 bps from the prior-year quarter.
MTD’s Balance Sheet & Cash Flow
As of Sept. 30, 2024, Mettler-Toledo’s cash and cash equivalent balance was $71.6 million, up from $70.8 million as of June 30, 2024.
The long-term debt was $1.89 billion as of Sept. 30, 2024, compared with $1.75 billion.
Mettler-Toledo generated $254.7 million in cash from operating activities in the reported quarter compared with $257.5 million in the previous quarter. The free cash flow was $237.4 million in the reported quarter.
Mettler-Toledo’s Q4 & 2024 Guidance
For the fourth quarter of 2024, Mettler-Toledo anticipates sales to increase 8% in local currency from the year-ago quarter’s reported figure.
The Zacks Consensus Estimate for fourth-quarter sales is pegged at $1.01 billion, indicating an increase of 8.12% from the year-ago quarter.
Adjusted earnings are anticipated to be $11.63-$11.78 per share, implying 24-25% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for earnings is pinned at $11.79 per share, suggesting an increase of 25.43% from the year-ago quarter.
For 2024, Mettler-Toledo anticipates sales in local currency to rise 2% from the year-earlier reported figure.
The Zacks Consensus Estimate for 2024 sales is pegged at $3.83 billion, suggesting an increase of 0.98% year over year.
The company increased its guidance for the adjusted EPS from $40.20-$40.50 to $40.35-$40.50. The new guidance range suggests growth of approximately 6% from the year-ago reported number, which includes a foreign-currency headwind of 2%.
The Zacks Consensus Estimate for the same is pegged at $40.34, an increase of 6.07% year over year.
MTD’s Zacks Rank & Stocks to Consider
Currently, Mettler-Toledo has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer & Technology sector are StoneCo STNE, Palo Alto Networks PANW and Bilibili BILI. StoneCo sports a Zacks Rank #1 (Strong Buy), while Palo Alto and Bilibili carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
StoneCo shares have lost 37.3% in the year-to-date period. STNE is set to report third-quarter fiscal 2025 results on Nov. 12.
Palo Alto Networks shares have jumped 200.3% year to date. PANW is set to report first-quarter fiscal 2025 results on Nov. 20.
Bilibili shares have gained 98.3% year to date. BILI is set to report third-quarter 2024 results on Nov. 14.
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