GE Healthcare Technologies
reported better-than-expected third-quarter earnings and profit margins. Shares were headed higher in early trading.
GE Healthcare
(ticker: GEHC) on Tuesday morning announced adjusted third-quarter earnings per share (EPS) of 99 cents from sales of $4.8 billion. Wall Street was looking for 90 cents and $4.8 billion, respectively.
Sales grew 5% year over year on a comparable basis. Operating profit margins came in at 15.4%. Wall Street was projecting about 14%.
“We delivered another strong quarter of revenue growth with margin performance demonstrating progress on productivity and price,” said CEO Peter Arduini in a news release. “Cash performance was strong as we leveraged lean principles to improve inventory management. We remain confident in our 2023 outlook as we continue to innovate for customers and patients.”
Free cash flow came in at $570 million. The company left its full-year EPS guidance range unchanged at $3.70 to $3.85.
That range implies fourth-quarter EPS of 94 cents to $1.09. Wall Street is currently projecting $1.14 a share.
GE Healthcare stock was up 4.5% shortly after the results were released.
S&P 500
and
Dow Jones Industrial Average
futures were flat.
Coming into Tuesday’s trading, GE Healthcare shares were up about 13% so far this. The S&P 500 was up about 9%.
Management hosts a conference call at 8:30 a.m. Eastern time to discuss results. Investors and analysts will be looking for any clues about how demand for medical equipment is shaping up for 2024.
Barron’s wrote positively about GE Healthcare shares in March, believing that profit margin expansion would lead to a better price-to-earnings ratio. Since the article appeared shares have dropped about 17%. The S&P 500 is up about 6% over the same span.
GE Healthcare shares are trading for less than 15 times estimated 2024 earnings. In March they were trading for about 20 times estimated 2024 earnings. Over that span, 2024 earnings estimates have gone from $4.26 to $4.30 a share.
Write to Al Root at [email protected]
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