Keysight Technologies, Inc. (KEYS) delivered the kind of earnings report that makes analysts reach for their calculators and revise their models upward. The test and measurement equipment maker posted fourth-quarter results Monday evening that sailed past expectations on both the top and bottom lines.
The numbers tell a straightforward story: Keysight reported earnings of $1.91 per share, comfortably ahead of the $1.83 analyst consensus. Revenue came in at $1.42 billion, topping the $1.38 billion estimate. When you beat on earnings and revenue simultaneously, Wall Street tends to take notice.
"Keysight delivered an outstanding quarter and strong close to the fiscal year, returning the company to full-year growth with order momentum accelerating through the year," said Satish Dhanasekaran, Keysight's CEO.
The real kicker came with the forward guidance. For the first quarter, Keysight expects adjusted earnings between $1.95 and $2.01 per share, well above the $1.83 analyst estimate. Revenue guidance of $1.53 billion to $1.55 billion also exceeded the $1.42 billion consensus by a healthy margin. That's the kind of outlook that suggests management sees genuine momentum building, not just a one-quarter blip.
Investors liked what they saw, pushing Keysight shares up 8.6% to $193.14 on Tuesday.
The earnings beat prompted a flurry of price target increases from Wall Street analysts who cover the stock:
- Susquehanna analyst Mehdi Hosseini maintained a Positive rating and raised his price target from $215 to $225.
- Barclays analyst Tim Long kept his Overweight rating while boosting the target from $195 to $232.
- JP Morgan analyst Samik Chatterjee maintained an Overweight rating and increased the price target from $200 to $207.
- Morgan Stanley analyst Meta Marshall held an Equal-Weight rating but raised the target from $180 to $208.
- Wells Fargo analyst Aaron Rakers maintained an Overweight rating and lifted the price target from $190 to $225.
The analyst revisions reflect growing confidence that Keysight's business has turned a corner, with the acceleration in orders suggesting demand trends are improving across the company's key end markets.
