AMETEK Inc (AME) reported a second quarter sales increase of 13% from the same period in 2009. The company also saw orders jump 33% in the quarter.
AMETEK is a global manufacturer of electronic instruments and electro-mechanical devices. It is based in Pennsylvania and has a market cap of $4.8 billion.
Strong Second Quarter Results
AMETEK announced second quarter EPS of $0.63, a 31% increase from 2009, and in-line with expectations.
The electronic instruments group (which accounts for 52% of total sales) saw revenue increase 8% from 2009. Operating margins for the division improved from 20.9% to 23.8% in the quarter as management streamlined its cost structure through its “Operational Excellence” initiatives.
The electro-mechanical group (which accounts for the other 48% of total sales) was the stronger performer. Sales increased 18% over the second quarter of 2009, while operating income improved 26% over the same period.
Solid Growth Ahead
Management expects total sales growth in the low double digits for the full year. The company gave guidance in the range of $2.43 to $2.47 for 2010, in-line with the Zacks Consensus Esitmate of $2.47, and representing 28% growth over 2009.
The Zacks Consensus Estimate for 2011 is $2.85, 15% higher than the 2010 estimate. Analysts expect earnings to continue to grow at that 15% clip for each of the next five years.
The stock currently trades at 18.2x and 15.8x 2010 and 2011 estimates, respectively. It currently has a dividend yield of 0.54%.
AMETEK is a Zacks #2 Rank (buy) stock.
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