Overview
Bank of America has moved Agilent Technologies to a Buy rating from Neutral, pointing to robust execution and market share gains despite lingering questions in the broader life sciences tools sector. The firm set a new price objective of $145, down modestly from a prior $150 target, while keeping a constructive view on Agilent's long-term growth trajectory.
Quarterly performance
Agilent's fiscal second-quarter results exceeded expectations on several fronts. Core revenue grew 6.3%, beating guidance at the high end. The company also delivered operating margins and adjusted earnings per share above forecasts, according to BofA's assessment.
Analysts highlighted continued momentum in liquid chromatography (LC), gas chromatography (GC), and LC/MS replacement cycles. Those replacement dynamics were described as being in the "early innings" of a growth phase, supporting instrument demand beyond simple refresh activity.
Business segments and drivers
BofA noted that Agilent's instruments business recorded high single-digit growth during the quarter. The brokerage attributed that performance to competitive wins, displacement driven by new innovations, and improving trends in market share. Management indicated that demand is broadening as new product platforms gain traction with existing customers.
The Chemical and Advanced Materials (CAM) segment also outpaced expectations, posting 8% core growth. That strength was linked to activity in semiconductor and chemicals markets. Analysts cited GC replacement demand tied to aging instrument fleets as a contributor to momentum, with particular strength in the Americas and Asia excluding China. Spectroscopy demand was reported as robust across semiconductor and advanced materials workflows.
Guidance and estimate revisions
Following the quarterly beat, Agilent modestly raised its full-year guidance. Management signaled a more positive outlook for CAM, forensics, and diagnostics markets, while noting that conditions in food testing remain softer.
Bank of America revised its adjusted earnings estimates upward, projecting EPS of $6.05 for 2026 and $6.65 for 2027. Those figures compare with the brokerage's prior estimates of $5.97 for 2026 and $6.57 for 2027.
BofA stated it still expects second-half revenue and margin progression to be achievable despite tougher year-over-year comparisons.
Implications
The upgrade reflects confidence in Agilent's ability to translate instrument innovation and replacement demand into share gains and improved profitability. Strength in CAM and pockets of resilience across semiconductor and advanced materials workflows were central to BofA's reassessment. At the same time, the brokerage tempered its near-term price objective while increasing multi-year EPS forecasts.
Key takeaways
- Bank of America upgraded Agilent to Buy and set a $145 price objective.
- Agilent beat expectations in fiscal Q2: 6.3% core revenue growth, stronger margins and adjusted EPS.
- Instruments and CAM segments showed notable strength, with replacement cycles and semiconductor-related demand supporting growth.
Summary
Agilent's fiscal second-quarter outperformance led Bank of America to raise its rating to Buy, even as the brokerage slightly lowered its price target. The company posted above-guidance revenue growth, margin expansion and stronger adjusted EPS, with instruments and CAM driving the upside. BofA raised its EPS forecasts for 2026 and 2027 and expects continued second-half progression despite more difficult year-over-year comparisons.