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Reflecting On Inspection Instruments Stocks’ Q1 Earnings: FARO (NASDAQ:FARO)


Kayode Omotosho /
2024/07/04 7:47 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at FARO (NASDAQ:FARO) 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 6 inspection instruments stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 2.4%. while next quarter's revenue guidance was 2.6% below consensus. Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and while some of the inspection instruments stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.6% on average since the previous earnings results.

FARO (NASDAQ:FARO)

Launched by two PhD students in a garage, FARO (NASDAQGS:FARO) provides 3D measurement and imaging systems for the manufacturing, construction, engineering, and public safety industries.

FARO reported revenues of $84.24 million, down 0.9% year on year, topping analysts' expectations by 3.9%. It was a solid quarter for the company, with a decent beat of analysts' earnings estimates.

"We're pleased with our strong start to the year, with our first quarter financial performance providing a solid foundation from which we expect to continue to invest in our strategic initiatives within our core markets," said Peter Lau, President & Chief Executive Officer.

FARO Total Revenue

The stock is down 13.9% since the results and currently trades at $16.29.

Is now the time to buy FARO? Access our full analysis of the earnings results here, it's free.

Best Q1: 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 $196.3 million, up 23.4% year on year, outperforming analysts' expectations by 7.7%. It was a stunning quarter for the company with revenue and EPS topping analysts' expectations.

Badger Meter Total Revenue

Badger Meter achieved the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is up 23.2% since the results and currently trades at $188.68.

Is now the time to buy Badger Meter? Access our full analysis of the earnings results here, it's free.

Weakest Q1: 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 $1.35 billion, down 2.4% year on year, falling short of analysts' expectations by 3.1%. It was a weak quarter for the company, with a miss of analysts' organic revenue estimates and underwhelming earnings guidance for the full year.

Teledyne had the weakest performance against analyst estimates in the group. The stock is down 4.9% since the results and currently trades at $387.28.

Read our full analysis of Teledyne's results here.

Mirion (NYSE:MIR)

With its monitoring devices installed on spacecraft, Mirion (NYSE:MIR) offers radiation technology to government agencies, healthcare providers, and industrial companies.

Mirion reported revenues of $192.6 million, up 5.8% year on year, in line with analysts' expectations. It was a decent quarter for the company with EBITDA exceeding analysts' expectations.

The stock is down 1.2% since the results and currently trades at $10.73.

Read our full, actionable report on Mirion 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 (NASDAQGS:ITRI) offers energy and water management products for the utility industry, municipalities, and industrial customers.

Itron reported revenues of $603.4 million, up 22% year on year, surpassing analysts' expectations by 4.2%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates.

The stock is up 8.7% since the results and currently trades at $99.47.

Read our full, actionable report on Itron here, it's free.

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