Looking back on inspection instruments stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including Keysight (NYSE: KEYS) 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 5 inspection instruments stocks we track reported a very strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was in line.
Luckily, inspection instruments stocks have performed well with share prices up 20.8% on average since the latest earnings results.
Weakest Q1: 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 $1.31 billion, up 7.4% year on year. This print exceeded analysts’ expectations by 1.8%. Overall, it was a satisfactory quarter for the company with a decent beat of analysts’ EBITDA estimates but EPS guidance for next quarter missing analysts’ expectations.
The stock is down 3.4% since reporting and currently trades at $157.04.
Is now the time to buy Keysight? Access our full analysis of the earnings results here, it’s free.
Best Q1: FARO (NASDAQ: FARO)
Launched by two PhD students in a garage, FARO (NASDAQ: FARO) provides 3D measurement and imaging systems for the manufacturing, construction, engineering, and public safety industries.
FARO reported revenues of $82.86 million, down 1.6% year on year, outperforming analysts’ expectations by 3.3%. The business had an exceptional quarter with EPS guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EPS estimates.
FARO delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 60.3% since reporting. It currently trades at $42.31.
Is now the time to buy FARO? Access our full analysis of the earnings results here, it’s free.
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 $1.45 billion, up 7.4% year on year, exceeding analysts’ expectations by 1.5%. It may have had the worst quarter among its peers, but its results were still good as it also locked in a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 8.3% since the results and currently trades at $498.86.
Read our full analysis of Teledyne’s results here.
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 $222.2 million, up 13.2% year on year. This number met analysts’ expectations. Overall, it was an exceptional quarter as it also produced a solid beat of analysts’ EBITDA estimates.
Badger Meter pulled off the fastest revenue growth among its peers. The stock is up 34.9% since reporting and currently trades at $248.22.
Read our full, actionable report on Badger Meter here, it’s free.
Itron (NASDAQ: ITRI)
Founded by a small group of engineers who wanted to build a more efficient way to read utility meters, Itron (NASDAQ: ITRI) offers energy and water management products for the utility industry, municipalities, and industrial customers.
Itron reported revenues of $607.2 million, flat year on year. This print came in 1.1% below analysts' expectations. Aside from that, it was a strong quarter as it produced an impressive beat of analysts’ adjusted operating income estimates.
Itron had the weakest performance against analyst estimates among its peers. The stock is up 4% since reporting and currently trades at $115.70.
Read our full, actionable report on Itron here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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