Varian Medical Systems Earnings: Here’s Why Investors are Ambivalent Now

Varian Medical Systems Inc. (NYSE:VAR) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

Varian Medical Systems Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 7.29% to $1.03 in the quarter versus EPS of $0.96 in the year-earlier quarter.

Revenue: Rose 2.97% to $726.2 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Varian Medical Systems Inc. reported adjusted EPS income of $1.03 per share. By that measure, the company beat the mean analyst estimate of $1.01. It missed the average revenue estimate of $749.01 million.

Quoting Management: “Varian’s net earnings rose versus the year-ago quarter in line with expectations while revenues rose somewhat less than expected due primarily to a significant currency headwind with the Yen as well as inventory adjustments among major X-ray tube customers in Japan,” said Dow R. Wilson, CEO of Varian Medical Systems.

Key Stats (on next page)…

Revenue decreased 5.49% from $768.36 million in the previous quarter. EPS increased 0.98% from $1.02 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $1.21 and has not changed. For the current year, the average estimate has moved down from a profit of $4.11 to a profit of $4.1 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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