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Strong Communications Sales Aid APH's Q4 Earnings: Is the Stock a Buy?
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Amphenol’s (APH - Free Report) fourth-quarter 2024 Communications Solutions revenues of $1.93 billion beat the Zacks Consensus Estimate by 17.87%. Communications Solutions revenues surged 43.3% year over year, accounting for 44.7% of sales in the reported quarter.
In the reported quarter, Amphenol’s adjusted earnings of 55 cents per share beat the Zacks Consensus Estimate by 10%. The earnings figure increased 34.1% year over year.
APH shares have jumped 7.04% following the results. It returned 58.9% in the trailing 12-month period, compared with the Zacks Computer and Technology sector’s appreciation of 30.3%.
Strong Defense Sales Aid APH’s Prospects
Amphenol benefits from a diversified business model. In the reported quarter, Communications sales were driven by strong end-market performance, including Defense sales, which increased 16% reportedly and 9% organically in the fourth quarter of 2024. The end market accounted for 10% of quarterly revenues.
APH expects sales in the defense market to increase moderately on a sequential basis.
Amphenol’s strong portfolio of solutions, including high-technology interconnect products, is a key catalyst. Expanding spending on both current and next-generation defense technologies bodes well for APH’s top-line growth.
Apart from Defense, Amphenol’s prospects ride on strong demand for its solutions across Commercial Air, Industrial and Mobile devices.
Commercial Air accounted for 6% of fourth-quarter revenues. Sales surged 137% year over year and 18% organically, driven by acquisitions, including CIT. Sequentially, Commercial Air sales increased by 7%.
For the first quarter of 2025, Amphenol expects a mid-to-high single-digit range increase in Commercial Air sales.
Industrial accounted for 23% of fourth-quarter revenues. Sales increased 26% year over year on a reported basis, while the figure inched up 3% sequentially.
For the first quarter of 2025, Industrial sales are expected to decline in the low double digits from fourth-quarter 2024 levels.
Mobile Devices contributed 10% of fourth-quarter revenues. Sales increased 15% year over year on a reported basis, while the figure jumped 7% sequentially.
APH’s Q1 2025 Guidance Positive
Amphenol offered encouraging guidance for first-quarter 2025, expected to push shares higher.
Amphenol expects first-quarter 2025 earnings between 49 cents and 51 cents per share, indicating growth between 23% and 28% year over year. Revenues are anticipated between $4 billion and $4.10 billion, suggesting growth in the 23-26% range.
The Zacks Consensus Estimate for first-quarter 2025 revenues is pegged at $3.94 billion, suggesting a 20.89% increase year over year. The consensus estimate for earnings is pegged at 47 cents per share, unchanged over the past 60 days and indicating growth of 17.50% on a year-over-year basis.
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Strong Communications Sales Aid APH's Q4 Earnings: Is the Stock a Buy?
Amphenol’s (APH - Free Report) fourth-quarter 2024 Communications Solutions revenues of $1.93 billion beat the Zacks Consensus Estimate by 17.87%. Communications Solutions revenues surged 43.3% year over year, accounting for 44.7% of sales in the reported quarter.
In the reported quarter, Amphenol’s adjusted earnings of 55 cents per share beat the Zacks Consensus Estimate by 10%. The earnings figure increased 34.1% year over year.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Net sales increased 29.8% year over year to $4.32 billion, beating the consensus mark by 7.01%. Organically, net sales increased 20%.
Click here to check the details of Amphenol’s fourth-quarter 2024 results.
Amphenol Corporation Revenue (TTM)
Amphenol Corporation revenue-ttm | Amphenol Corporation Quote
APH shares have jumped 7.04% following the results. It returned 58.9% in the trailing 12-month period, compared with the Zacks Computer and Technology sector’s appreciation of 30.3%.
Strong Defense Sales Aid APH’s Prospects
Amphenol benefits from a diversified business model. In the reported quarter, Communications sales were driven by strong end-market performance, including Defense sales, which increased 16% reportedly and 9% organically in the fourth quarter of 2024. The end market accounted for 10% of quarterly revenues.
APH expects sales in the defense market to increase moderately on a sequential basis.
Amphenol’s strong portfolio of solutions, including high-technology interconnect products, is a key catalyst. Expanding spending on both current and next-generation defense technologies bodes well for APH’s top-line growth.
Apart from Defense, Amphenol’s prospects ride on strong demand for its solutions across Commercial Air, Industrial and Mobile devices.
Commercial Air accounted for 6% of fourth-quarter revenues. Sales surged 137% year over year and 18% organically, driven by acquisitions, including CIT. Sequentially, Commercial Air sales increased by 7%.
For the first quarter of 2025, Amphenol expects a mid-to-high single-digit range increase in Commercial Air sales.
Industrial accounted for 23% of fourth-quarter revenues. Sales increased 26% year over year on a reported basis, while the figure inched up 3% sequentially.
For the first quarter of 2025, Industrial sales are expected to decline in the low double digits from fourth-quarter 2024 levels.
Mobile Devices contributed 10% of fourth-quarter revenues. Sales increased 15% year over year on a reported basis, while the figure jumped 7% sequentially.
APH’s Q1 2025 Guidance Positive
Amphenol offered encouraging guidance for first-quarter 2025, expected to push shares higher.
Amphenol expects first-quarter 2025 earnings between 49 cents and 51 cents per share, indicating growth between 23% and 28% year over year. Revenues are anticipated between $4 billion and $4.10 billion, suggesting growth in the 23-26% range.
The Zacks Consensus Estimate for first-quarter 2025 revenues is pegged at $3.94 billion, suggesting a 20.89% increase year over year. The consensus estimate for earnings is pegged at 47 cents per share, unchanged over the past 60 days and indicating growth of 17.50% on a year-over-year basis.
APH’s Zacks Rank & Upcoming Earnings to Watch Out
Currently, Amphenol has a Zacks Rank #2 (Buy).
Bill Holdings (BILL - Free Report) , Impinj (PI - Free Report) and Fortinet (FTNT - Free Report) are some other top-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector. Each of the three stocks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bill Holdings’ shares have appreciated 22.6% in the trailing 12-month period. BILL is set to report its second-quarter fiscal 2025 results on Feb. 6.
Impinj shares have returned 32.5% in the trailing 12-month period. PI is set to report its fourth-quarter 2024 results on Feb. 5.
Fortinet shares are up 52.5% in the trailing 12-month period. FTNT is set to report its fourth-quarter 2024 results on Feb. 6.