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PerkinElmer Reports Upbeat Q2 Earnings, Announces Divestiture

Story Highlights

PKI stock rose 2% in Monday’s pre-market trade, and there are multiple reasons behind this uptick.

Massachusetts-based life sciences and diagnostics company PerkinElmer, Inc. (NYSE: PKI) has reported better-than-expected earnings for the second quarter of 2022. Meanwhile, the company has signed an agreement to sell its Applied, Food, and Enterprise Services businesses.

In the quarter, adjusted earnings of $2.32 per share surpassed the Street’s estimate of $2.01 per share but came in lower than the year-ago figure of $2.83 a share.

Revenues remained flat year-over-year at $1.23 billion. Discovery & Analytical Solutions revenues increased to $661 million from $513 million a year ago. However, revenues of the Diagnostics segment declined to $569 million from $716 million in the same quarter last year.

PerkinElmer Issues Guidance

PerkinElmer has provided guidance for the third quarter. It expects adjusted EPS to range from $1.40 to 1.45 and revenues between $1.02 billion and $1.03 billion.

Further, the company has raised its outlook for 2022 and expects revenues between $4.60 billion and $4.64 billion. Adjusted earnings are projected to be in the range of $7.80 to $7.90 per share.

PerkinElmer to Divest Applied, Food, and Enterprise Services Businesses

PerkinElmer has signed an agreement to sell its Applied, Food, and Enterprise Services businesses to New York-based investment manager New Mountain Capital for $2.45 billion. The deal is likely to close in the first quarter of next year.

The President and CEO of PerkinElmer, Prahlad Singh, said, “With today’s divestiture announcement, we position the company to transform into a pureplay, high growth, high margin life sciences and diagnostics company with even more focus to capitalize on attractive end markets.”

Analysts Have a Hold Rating on PKI Stock

Based on two Buys, five Holds, and one Sell, the stock has a Hold consensus rating. PKI’s average price target of $164.38 implies 7.3% upside potential from current levels.

Investors Are Negative about PerkinElmer

TipRanks’ Stock Investors tool shows that investors currently have a Very Negative stance on PKI, with 2.2% of investors on TipRanks decreasing their exposure to the stock over the past 30 days.

PKI Stock Rises in Monday’s Pre-Market Trade

Following its results, PKI stock was trading almost 2% higher in the pre-market trading session on Monday, at the time of writing. Investors welcomed the company’s guidance for the rest of the year, and its plans to divest Applied, Food, and Enterprise Services businesses.

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