Agilent Technologies (A): Evaluating Valuation Following Strong Earnings Beat and Upbeat Growth Outlook

When a company beats expectations and signals more growth ahead, investors tend to take notice. That’s exactly what just happened with Agilent Technologies (A), after it posted third-quarter results that topped forecasts and revealed that every business segment saw revenue grow compared to a year ago. Management reinforced this momentum by offering upbeat revenue and earnings guidance for the next quarter. With solid execution and an encouraging outlook in hand, investors are naturally wondering if the latest numbers could be the beginning of a new uptrend for Agilent’s stock.

Over the past year, however, the stock’s trajectory has been anything but a straight line. Agilent shares are down about 16% in the past twelve months, with lackluster momentum holding them back for much of this year, even as some peers have rallied. Still, there are signs of optimism emerging: the stock has clawed back gains over the past month and recent strategic moves, including AI-powered diagnostics collaborations and continued dividend payments, are generating fresh headlines. It’s a mix of renewed confidence and cautious optimism that is setting the stage for a revaluation debate.

So after this stretch of underperformance and a sudden jump in market optimism, is Agilent’s stock finally trading at a discount, or are investors already factoring in the company’s next leg of growth?

Most Popular Narrative: 11.1% Undervalued

According to the most widely followed narrative, Agilent Technologies is currently viewed as undervalued based on forward-looking estimates of earnings, revenue growth, and margin expansion.

Strategic investments in higher-margin recurring revenue streams, including consumables, software, services, and digital platforms, are gaining traction. CrossLab and services have delivered consistent mid-single-digit growth and high customer satisfaction, which indicates further margin expansion and greater earnings stability in future periods.

Want to uncover the secret behind Agilent’s double-digit upside? The fulcrum lies in daring growth assumptions and expectations for industry-leading profit margins. What are the surprising projections that support this bullish valuation? Discover how bold analyst forecasts transform today’s share price into tomorrow’s opportunity.

Result: Fair Value of $138.83 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, sustained funding pressures in government research and rising global tariffs could still challenge Agilent’s growth outlook, despite recent optimism.

Find out about the key risks to this Agilent Technologies narrative.

Another View: What Does Our DCF Model Say?

While the analyst consensus points to Agilent being undervalued, our DCF model tells a different story. It suggests the shares might actually be priced above their fair value. Why do these methods disagree? Which matters more for investors?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Agilent Technologies for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Agilent Technologies Narrative

If the numbers here spark a different perspective or you prefer to reach your own conclusions, it’s easy to dive in and craft a personalized view in just minutes. Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Agilent Technologies.

Looking for More Investment Ideas?

Smart investors never stop with just one name. Give yourself an edge and unearth fresh opportunities using the Simply Wall Street screener. Don’t miss your chance to get ahead of the crowd.

• Boost your income by targeting companies offering consistent payouts and reliable yields with dividend stocks with yields > 3%.
• Capitalize on breakthroughs in medical technology by tapping into innovative firms leading the healthcare AI revolution through healthcare AI stocks.
• Snap up stocks that are trading for less than their true value, before the rest of the market catches on with undervalued stocks based on cash flows.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com