Wrapping up Q2 earnings, we look at the numbers and key takeaways for the inspection instruments stocks, including Itron (NASDAQ: ITRI) 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 4 inspection instruments stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was in line.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.7% since the latest earnings results.
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 $606.8 million, flat year on year. This print was in line with analysts’ expectations, and overall, it was a strong quarter for the company with EPS guidance for next quarter exceeding analysts’ expectations and an impressive beat of analysts’ EBITDA estimates.
"Itron delivered solid second quarter results driving quarterly record levels of margin, profitability, and cash flow," said Tom Deitrich, Itron’s president and CEO.
Itron delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Unsurprisingly, the stock is down 10.1% since reporting and currently trades at $124.50.
Is now the time to buy Itron? Access our full analysis of the earnings results here, it’s free.
Best Q2: 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 $1.51 billion, up 10.2% year on year, outperforming analysts’ expectations by 2.7%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates.
Teledyne scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 6.6% since reporting. It currently trades at $592.38.
Is now the time to buy Teledyne? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: 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 $238.1 million, up 9.9% year on year, exceeding analysts’ expectations by 0.6%. Still, it was a softer quarter as it posted a significant miss of analysts’ EPS and EBITDA estimates.
As expected, the stock is down 27.3% since the results and currently trades at $178.58.
Read our full analysis of Badger Meter’s results here.
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 $1.35 billion, up 11.1% year on year. This result topped analysts’ expectations by 2.7%. Overall, it was a strong quarter as it also produced a solid beat of analysts’ adjusted operating income estimates and an impressive beat of analysts’ EBITDA estimates.
Keysight scored the fastest revenue growth among its peers. The stock is up 7.8% since reporting and currently trades at $176.54.
Read our full, actionable report on Keysight here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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