Bruker (BRKR) just reported a classic mixed earnings result, topping quarterly profit estimates while simultaneously trimming its full year revenue and earnings outlook. This combination has clearly cooled investor enthusiasm.
See our latest analysis for Bruker.
The guidance cut comes after a sharp rebound in sentiment, with Bruker’s 30 day share price return of 19.8 percent and 90 day gain of 56.9 percent, in contrast with a weaker 1 year total shareholder return of negative 17.0 percent. This suggests that near term momentum is improving even as the longer term record remains underwhelming.
If this kind of volatility has you thinking about diversification, it may be worth exploring healthcare stocks as a way to uncover other healthcare names with different growth and risk profiles.
With earnings beating expectations but guidance moving lower, and the share price now hovering just below analyst targets after a strong rebound, is Bruker an underappreciated turnaround candidate, or is the market already pricing in any future recovery?
Compared with Bruker’s last close near 48 dollars, the most popular narrative pins fair value slightly higher, implying only marginal upside from here.
The analysts have a consensus price target of $46.727 for Bruker based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $65.0, and the most bearish reporting a price target of just $38.0.
Read the complete narrative.
Want to see what kind of revenue path, margin rebuild, and future earnings multiple are stitched together to justify this tight valuation gap? The answer might surprise you.
Result: Fair Value of $48.83 (ABOUT RIGHT)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, persistent funding headwinds and execution risk around margin improvement could easily derail the constructive bookings story and reset expectations again.
Find out about the key risks to this Bruker narrative.
While the narrative fair value sits close to the market price, our DCF model paints a cooler picture, putting Bruker’s value nearer 36.72 dollars. This suggests the shares look overvalued at current levels. Is the market now leaning too heavily on the recovery story?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Bruker for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 910 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.