Dragonfly Energy And Bruker Partner To Accelerate Battery Technology Development

Here are three stocks added to the Zacks Rank #5 (Strong Sell) List today:

Bruker Corporation BRKR is a scientific instruments company. The Zacks Consensus Estimate for its current year earnings has been revised 7.3% downward over the last 60 days.

Commercial Metals Company CMC is a metals processing company. The Zacks Consensus Estimate for its current year earnings has been revised 14.5% downward over the last 60 days.

Concentrix Corporation CNXC is a customer experience management company.The Zacks Consensus Estimate for its current year earnings has been revised 5.5% downward over the last 60 days.

View the entire Zacks Rank #5 List.

Zacks Investment Research

Bruker Corporation BRKR recently announced a new technology, EpicIF (Enhanced photobleaching in cyclic immunofluorescence), to further enhance the CellScape Precise Spatial Proteomics platform for highly multiplexed immunofluorescence (IF).

The new technology is likely to enhance the CellScape platform by expanding antibody compatibility and doubling throughput while maintaining tissue integrity and lack of cross-reactivity.

Likely Trend of BRKR Stock Following the News

Following the announcement, shares of the company moved nearly 4.6% south to $57.73 at Friday’s close. In the year-to-date period, BRKR shares have plunged 21.5% compared with the industry’s decline of 4%. The S&P 500 increased 26.1% in the same time frame.

Meanwhile, BRKR currently has a market capitalization of $8.8 billion.

More on BRKR’s CellScape Precise Spatial Proteomics Platform

Launched in 2022, The CellScape Spatial Proteomics Platform is an advanced platform designed to analyze protein expression within cellular contexts, offering high-resolution insights into spatial proteomics.

This platform allows researchers to precisely map proteins in tissue samples, which can reveal cell-specific protein patterns, interactions, and functions within complex tissue architectures. By combining spatial information with proteomic data, CellScape enhances understanding of cellular behavior and disease mechanisms, facilitating breakthroughs in cancer research, drug discovery, and personalized medicine.

CellScape captures minute morphological characteristics and the full range of protein expression in a biological sample, from the least to the most abundant. The platform also utilizes directly-labeled primary antibodies, enabling a robust and modular chemistry that allows researchers to build assays by combining panels and/or individual markers, even after the conclusion of an experimental run.

More on BRKR’s EpicIF Technology

With the new EpicIF technology, Bruker further advanced CellScape chemistry by expanding the range of compatible commercially available fluorophore-conjugated antibodies by nearly 10-fold, simplifying assay development and increasing throughput by up to two-fold.

EpicIF enhances photobleaching efficacy by combining a proprietary reagent with visible light to gently erase fluorescence signals from nearly any fluorophore. Like the prior version, the epitopes are preserved while maintaining tissue integrity.

EpicIF is supported by the concurrent release of new software, CellScape Navigator, which introduces a more intuitive user interface and easy experiment setup. EpicIF and CellScape Navigator will likely be available as upgrades to current CellScape instruments.

Favorable Industry Prospects for BRKR

Per a reportby Grand View Research, the global spatial proteomics market size was valued at $77.6 billion in 2023 and is expected to witness a CAGR of 14.8% from 2024-2030.

The market has seen significant growth, driven by technological advancements and increasing demand for in-depth protein analysis. One of the primary drivers is the rapid development of advanced imaging and mass spectrometry techniques that enable the visualization and quantification of proteins within their native tissue environments.

Bruker’s Zacks Rank & Stocks to Consider

BRKR carries a Zacks Rank #4 (Sell) at present.

Some better-ranked stocks in the broader medical space are AngioDynamics ANGO, Quest Diagnostics DGX and RadNet RDNT. Each stock presently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

ANGO’s earnings surpassed estimates in three of the trailing four quarters and missed once, delivering an average surprise of 31.71%.

AngioDynamics’ shares have lost 19.2% year to date against the industry’s6.1% growth.

Quest Diagnostics has an estimated long-term growth rate of 6.8%. DGX's earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.3%.

Quest Diagnostics’ shares have risen 42% year to date compared with the industry's 14.9% growth.

RadNet’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 98.2%.

RDNT’s shares have soared 93.7% year to date compared with the industry’s 14.8% growth.

Zacks Investment Research

Bruker Corporation BRKR delivered adjusted earnings per share (EPS) of 60 cents for the third quarter of 2024, down 18.9% year over year. The figure missed the Zacks Consensus Estimate by 1.6%.

The adjustments include expenses related to the amortization of purchased intangibles, acquisition-related costs and restructuring costs, among others.

GAAP EPS was 27 cents compared with 60 cents in the year-ago period.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Following the earnings announcement, BRKR stock rose 1.7% in aftermarket trading yesterday.

BRKR’S Revenues in Detail

Bruker's third-quarter revenues were $864.4 million, up 16.4% year over year. However, the figure missed the Zacks Consensus Estimate by 0.1%.

Excluding the positive impacts of 12.5% from acquisitions and a 0.7% positive impact of foreign currency rates, the company witnessed organic revenue growth of 3.1%.

On a geographic basis, the United States witnessed a 13.2% year-over-year rise in revenues to $239.0 million. Our model forecast for this region’s sales was $233.9 million.

Europe revenues increased 15.1% year over year to $290 million, while Asia Pacific revenues rose 14.4% to $262.4 million. Our model forecast for Europe and the Asia Pacific was $322.1 million and $267.7 million, respectively, for the third quarter.

The Other category’s revenues increased 44.8% year over year to $73 million. Our model’s projection was $26.9 million.

BRKR’s Segmental Analysis

Bruker reports results under two segments — BSI (comprising BioSpin, CALID and Nano) and Bruker Energy & Supercon Technologies (“BEST”).

Revenues in the BSI segment rose 18.2% to $799.5 million in the third quarter of 2024.

Within the segment, BioSpin Group’s revenues surged 17.5% from the year-ago quarter’s levels to $233 million. Our model’s projected revenues for the segment were $247.3 million. BioSpin’s organic revenues were up in the low double-digit percentage range, driven by strength in magnetic resonance and services businesses.

CALID’s revenues rose 16.8% year over year to $279.4 million. CALID’s organic revenues declined by a low single-digit percentage, as strong performance from the MALDI Biotyper and applied mass spectrometry businesses was more than offset by softness in biopharma. Our model forecast was $280.8 million.

Revenues from the NANO group climbed 20.3% to $287.1 million. Our model projected revenues of $260.8 million for this segment.

NANO’s organic revenues grew in the middle teens, with strong revenue growth in industrial research and semiconductor metrology bolstered by the AI megatrend.

The BEST segment’s revenues were $68.7 million, down 2.7% year over year. Revenues fell short of our model’s projection of $77.3 million.

Bruker’s Margin Trend

Bruker’s gross profit rose 9.4% to $418.6 million. The gross margin contracted 308 basis points (bps) to 48.4% on a 23.8% rise in costs.

SG&A expenses rose 30.2% to $229.9 million. R&D expenses went up 37.6% year over year to $98.1 million. Adjusted operating expenses of $328.0 million increased 32.2% year over year.

The adjusted operating profit was $90.8 million, down 32.7% from the prior-year quarter’s levels. The adjusted operating margin contracted 766 bps to 10.5%.

Financial Position

Bruker exited the third quarter of 2024 with cash and cash equivalents of $148.1 million compared with $169.7 million at the end of the second quarter.

The total long-term debt (including the current portion) at the end of the third quarter of 2024 was $2.26 billion, up from $1.16 billion at second-quarter end.

The cumulative net cash flow from operating activities was $61.3 million compared with $144.6 million during last year’s comparable period.

Bruker Corporation Price, Consensus and EPS Surprise

Bruker Corporation price-consensus-eps-surprise-chart | Bruker Corporation Quote

2024 Guidance

Bruker lowered its 2024 outlook.

For the full year, the company now expects revenues in the range of $3.34 to $3.37 (down from the previously guided range of $3.38-$3.44 billion). The updated guidance indicates year-over-year revenue growth of 12.5%-13.5% on a reported basis (previously 14%-16%).

The Zacks Consensus Estimate for revenues is pegged at $3.39 billion.

BRKR expects its 2024 adjusted EPS in the range of $2.36-$2.41 (earlier $2.59-$2.64). The consensus estimate for EPS is pegged at $2.61.

Our Take

Bruker ended the third quarter of 2024 with lower-than-expected results, wherein both revenue and earnings missed estimates. On a positive note, organic revenue growth for its BSI business was above market expectations. Despite delayed recoveries in biopharma and China demand, Bruker’s orders for its differentiated post-genomic, multi-omics, cleantech, semicon tools and infectious disease diagnostic solutions are gradually improving.

In the first half of the year, Bruker completed three strategic acquisitions that significantly accelerated its portfolio transformation and market expansion into spatial biology, molecular diagnostics and laboratory automation.

The company’s lowered forecast for 2024 does not bode well for the stock. Meanwhile, the contraction of both margins in the quarter adds to the worry.

BRKR’s Zacks Rank & Key Picks

BRKR currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks from the broader medical space are Phibro Animal Health PAHC, Quest Diagnostics DGX and HealthEquity HQY.

Phibro Animal Health reported fourth-quarter fiscal 2024 adjusted earnings of 41 cents per share, which topped the Zacks Consensus Estimate by 20.6%. Revenues of $273.2 million beat the Zacks Consensus Estimate by 4.1%. PAHC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

PAHC’s fiscal 2025 earnings are expected to surge 31.9% compared with the industry’s 11.6% growth. The company’s earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 4.1%.

Quest Diagnostics reported third-quarter 2024 adjusted earnings of $2.30 per share, which topped the Zacks Consensus Estimate by 1.8%. Revenues of $2.49 billion beat the consensus mark by 3.4%. DGX carries a Zacks Rank #2 (Buy) at present.

DGX’s 2024 earnings are expected to surge 2.1%. The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.3%.

HealthEquity, carrying a Zacks Rank #2 at present, reported second-quarter fiscal 2025 adjusted earnings of 86 cents per share, which surpassed the Zacks Consensus Estimate by 22.9%. Revenues of $299.9 million topped the Zacks Consensus Estimate by 5.4%.

HQY has an estimated long-term earnings growth rate of 28.2% compared with the industry’s 13.4%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.8%.

Zacks Investment Research

Rockwell Automation (ROK) came out with quarterly earnings of $2.47 per share, beating the Zacks Consensus Estimate of $2.40 per share. This compares to earnings of $3.64 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 2.92%. A quarter ago, it was expected that this industrial equipment and software maker would post earnings of $2.11 per share when it actually produced earnings of $2.71, delivering a surprise of 28.44%.

Over the last four quarters, the company has surpassed consensus EPS estimates three times.

Rockwell Automation, which belongs to the Zacks Electronics - Miscellaneous Products industry, posted revenues of $2.04 billion for the quarter ended September 2024, missing the Zacks Consensus Estimate by 1.46%. This compares to year-ago revenues of $2.56 billion. The company has topped consensus revenue estimates two times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Rockwell Automation shares have lost about 5.3% since the beginning of the year versus the S&P 500's gain of 24.3%.

What's Next for Rockwell Automation?

While Rockwell Automation has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Rockwell Automation: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $1.99 on $1.98 billion in revenues for the coming quarter and $10.33 on $8.41 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Electronics - Miscellaneous Products is currently in the top 26% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

One other stock from the same industry, Dragonfly Energy Holdings Corp. (DFLI), is yet to report results for the quarter ended September 2024. The results are expected to be released on November 14.

This company is expected to post quarterly loss of $0.18 per share in its upcoming report, which represents a year-over-year change of -5.9%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

Dragonfly Energy Holdings Corp.'s revenues are expected to be $14.12 million, down 11.1% from the year-ago quarter.

Zacks Investment Research