Core Viewpoint - Veralto (VLTO) is expected to report its fourth-quarter 2025 results on February 3, with a strong earnings surprise history, having exceeded the Zacks Consensus Estimate in the last four quarters with an average surprise of 6.5% [2][8]. Group 1: Q4 Expectations - The Zacks Consensus Estimate for VLTO's revenues in the upcoming quarter is $1.4 billion, reflecting a year-over-year increase of 4.3% [3][9]. - The Water Quality segment is projected to generate revenues of $836.3 million and operating income of $218.3 million, indicating year-over-year increases of 3.1% and 9.4%, respectively [4][9]. - The Product Quality & Innovation segment is expected to report revenues of $555.2 million and operating income of $145.2 million, representing year-over-year growth of 4% and 17%, respectively [5][9]. Group 2: Growth Drivers - The growth in the Water Quality segment is attributed to rising demand for innovative products and services, including analytical measurement instruments and tailored chemical treatment plans, driven by brands like Hach and Trojan Technologies [4]. - The Product Quality & Innovation segment's growth is supported by VLTO's marking and coding, packaging, and color services, particularly through the Esko brand, which has expanded its software solutions in the mid-market consumer-packaged goods segment [5]. - The recent acquisition of TraceGains is expected to enhance VLTO's growth by integrating its supply chain traceability and compliance expertise into the Veralto Enterprise System, improving market presence and operational efficiency [6]. Group 3: Earnings Outlook - The consensus estimate for VLTO's earnings is 98 cents per share, indicating a year-over-year growth of 3.2% [7]. - The company's Earnings ESP is currently at 0.00%, and it holds a Zacks Rank of 2 (Buy), suggesting that the odds of an earnings beat are not conclusive this time [8].

Core Insights - Veralto Corporation (VLTO) reported strong second-quarter 2025 results, with earnings and revenues exceeding the Zacks Consensus Estimate [1][6] - Adjusted earnings per share were 93 cents, surpassing estimates by 4.5% and increasing 9.4% year over year [1][6] - Total revenues reached $1.37 billion, beating the consensus estimate by 2.1% and rising 6.4% from the previous year [1][6] Financial Performance - The Water Quality segment generated revenues of $825 million, reflecting a year-over-year growth of 6.2% [4] - The Product, Quality & Innovation segment saw revenues increase by 6.9% year over year to $546 million [4] - Adjusted EBITDA was $285 million, marking a 5.6% increase from the same quarter last year, with an adjusted operating EBITDA margin improvement to 20.79% [4] Cash Flow and Debt - At the end of Q2, Veralto had cash and cash equivalents of $1.56 billion, up from $1.1 billion at the end of the previous quarter [5] - Long-term debt was reported at $2.67 million, a slight increase from $2.60 billion at the end of Q4 2024 [5] - The company generated $496 million in cash from operating activities during the quarter, with capital expenditures of $16 million [5] Future Guidance - For Q3 2025, Veralto anticipates mid-single-digit revenue growth year over year and adjusted diluted earnings per share between 91 cents and 95 cents [7] - The full-year 2025 adjusted earnings per share guidance has been raised to a range of $3.72 to $3.80, up from $3.60 to $3.70 [8] - The company targets a free cash flow conversion rate of 90% to 100% and has increased its core sales growth assumption to mid-single-digits [8]