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Transcat Q2 results beat estimates on calibration services growth, rentals demand

By Reuters News


Overview

  • US calibration services firm's fiscal Q2 revenue grew 18%, beating analyst expectations

  • Adjusted EPS for fiscal Q2 beat analyst expectations

  • Fiscal Q2 adjusted EBITDA rose and beat analyst expectations


Outlook

  • Transcat raises FY27 Service organic revenue growth outlook to low double digits from high single digits

  • Company expects at least 100 bps Service gross margin expansion in H2 FY27

  • Company sees continued strong demand in life sciences, aerospace, defense and other regulated end markets


Result Drivers

  • CALIBRATION BUSINESS - Co said growth in calibration services drove 23% increase in service revenue and expanded service gross margin

  • RENTALS DEMAND - Continued strength in rentals and product sales contributed to 10% distribution revenue growth

  • ACQUISITIONS - Southeastern Biomedical acquisition added scale in regulated end markets, supporting service revenue growth


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q2 Revenue

Beat

$97.09 mln

$92.46 mln (5 Analysts)

Q2 Adjusted EPS

Beat

$0.64

$0.46 (5 Analysts)

Q2 EPS

$0.25

Q2 Adjusted EBITDA

Beat

$14.90 mln

$13.35 mln (5 Analysts)

Q2 Gross Profit

$32.60 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the business support services peer group is "buy"

  • Wall Street's median 12-month price target for Transcat, Inc. is $113.00, about 28.5% above its November 2 closing price of $87.92

  • The stock recently traded at 43 times the next 12-month earnings vs. a P/E of 46 three months ago


Reuters Recommended Reads

  • Nov 2 - IDEXX raises forecast, betting diagnostics can offset weak vet visits

  • Nov 2 - Tempus AI Q3 revenue slightly beats estimates; raises guidance

  • Nov 3 - Life sciences tech firm Waters' Q3 revenue, adjusted EPS beat estimates


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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