Agilent Rises 11% in a Year: Should You Buy, Sell or Hold the Stock?

Core Viewpoint - Agilent Technologies has underperformed in the past year, with an 11% return compared to the broader Zacks Computer and Technology sector's 29.8% rise and the Zacks Electronics - Testing Equipment industry's 12% growth [1] Financial Performance - Agilent's struggles are primarily due to downturns in key end markets such as Pharmaceutical, Food, Academic and Government, and Environmental and Forensics, particularly in the fourth quarter of fiscal 2024 [2] - The Pharmaceutical segment, which contributes 35% to total revenues, saw a 1% year-over-year decline, while the Food and Environmental and Forensics segments experienced declines of 3% and 6%, respectively [3] - For the first quarter of fiscal 2025, Agilent expects revenues between $1.65 billion and $1.68 billion, indicating a potential decline of 0.5% to growth of 1.3% [4] - The Zacks Consensus Estimate for first-quarter fiscal 2025 revenues is $1.67 billion, suggesting a year-over-year increase of 0.56% [4] - Non-GAAP earnings for the first quarter are expected to be between $1.25 and $1.28 per share, with a consensus estimate of $1.27 per share, indicating a 1.55% year-over-year decline [5] - For fiscal 2025, Agilent revised its revenue guidance to $6.79 billion to $6.87 billion, with a consensus estimate of $6.83 billion, suggesting moderate growth of 4.94% from the previous year [5] - Fiscal 2025 non-GAAP earnings are expected to be between $5.54 and $5.61 per share, with a consensus mark of $5.56, indicating a 5.10% increase from fiscal 2024 earnings [6] Segment Performance - The Life Sciences and Applied Markets Group, accounting for half of total revenues, experienced a 1% year-over-year decline in the fourth quarter of fiscal 2024, driven by slower instrument sales as customers reduced spending [7] - The Diagnostics and Genomics Group segment also faced challenges, with a 1% drop on a reported basis and a 3% decline on a core basis for the fourth quarter of fiscal 2024, primarily due to expected softness in cell analysis instruments [8] Macroeconomic Factors - Macroeconomic pressures and regulatory challenges in China have significantly impacted Agilent's financial performance and strategic decisions, with the ongoing trade dispute between the United States and China posing a key concern for operations in the region [9]