Transcat (NASDAQ:TRNS) Releases Earnings Results, Beats Estimates By $0.13 EPS

Transcat (NASDAQ:TRNS) announced its quarterly earnings results on Tuesday, August 4th. The scientific and technical instruments company reported $0.51 earnings per share for the quarter, topping the consensus estimate of $0.38 by $0.13, FiscalAI reports. The company had revenue of $92.95 million for the quarter, compared to analysts’ expectations of $86.55 million. Transcat had a net margin of 0.99% and a return on equity of 5.56%.

Here are the key takeaways from Transcat’s conference call:

• Service revenue grew 27%, including 13% organic growth, marking Transcat’s 69th consecutive quarter of year-over-year service revenue growth. Management cited broad-based demand across regulated end markets and ongoing market-share gains.
• Service gross margin expanded 90 basis points to support a 31% increase in service gross profit, while service adjusted operating income rose 35%. Management expects further benefits from operating leverage, customer relationship maturation, pricing, mix optimization, and productivity initiatives.
• Management reaffirmed expectations for high-single-digit service organic growth and service gross-margin expansion for fiscal 2027. The company also plans to continue strategic acquisitions and grow its higher-margin rental business.
• Distribution gross margin declined 380 basis points year over year to 31.4%, primarily because the prior-year period benefited from unusually high vendor rebates. Diluted EPS was $0.14, pressured by acquisition-related amortization, stock compensation, interest expense, and executive transition costs.
• Transcat ended the quarter with $110.4 million of debt, $39.6 million of revolver availability, and a 2.19x leverage ratio. Management said its capital structure supports continued organic investment and acquisitions, including additional executive and M&A capabilities.

Transcat Trading Down 1.2%

TRNS opened at $82.36 on Friday. The company has a debt-to-equity ratio of 0.36, a quick ratio of 2.11 and a current ratio of 2.49. The stock’s 50 day moving average price is $88.73 and its 200-day moving average price is $83.02. Transcat has a one year low of $50.23 and a one year high of $100.00. The stock has a market cap of $773.36 million, a price-to-earnings ratio of 222.59 and a beta of 0.68.

Insider Buying and Selling

In related news, Director Craig D. Cairns bought 1,050 shares of the stock in a transaction dated Thursday, August 6th. The stock was purchased at an average cost of $93.97 per share, with a total value of $98,668.50. Following the completion of the purchase, the director owned 1,480 shares of the company’s stock, valued at $139,075.60. This trade represents a 244.19% increase in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, Director Christopher Gillette sold 504 shares of the company’s stock in a transaction dated Friday, August 7th. The stock was sold at an average price of $94.23, for a total transaction of $47,491.92. Following the completion of the transaction, the director owned 200 shares in the company, valued at approximately $18,846. The trade was a 71.59% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 1.80% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Transcat

A number of institutional investors and hedge funds have recently added to or reduced their stakes in TRNS. Wellington Management Group LLP lifted its position in shares of Transcat by 677.7% in the 4th quarter. Wellington Management Group LLP now owns 248,539 shares of the scientific and technical instruments company’s stock worth $14,100,000 after purchasing an additional 216,579 shares during the period. Renaissance Technologies LLC increased its holdings in Transcat by 109.7% during the fourth quarter. Renaissance Technologies LLC now owns 95,200 shares of the scientific and technical instruments company’s stock valued at $5,401,000 after buying an additional 49,800 shares during the period. ArrowMark Colorado Holdings LLC raised its stake in Transcat by 56.7% in the fourth quarter. ArrowMark Colorado Holdings LLC now owns 133,738 shares of the scientific and technical instruments company’s stock worth $7,587,000 after buying an additional 48,367 shares in the last quarter. Sei Investments Co. lifted its holdings in Transcat by 627.4% during the second quarter. Sei Investments Co. now owns 47,203 shares of the scientific and technical instruments company’s stock worth $4,058,000 after buying an additional 40,714 shares during the period. Finally, BNP Paribas Financial Markets lifted its holdings in Transcat by 352.9% during the third quarter. BNP Paribas Financial Markets now owns 41,553 shares of the scientific and technical instruments company’s stock worth $3,042,000 after buying an additional 32,378 shares during the period. Institutional investors own 98.34% of the company’s stock.

Wall Street Analyst Weigh In

TRNS has been the subject of a number of recent research reports. Wall Street Zen raised shares of Transcat from a “sell” rating to a “hold” rating in a research note on Sunday, June 28th. Zacks Research upgraded shares of Transcat from a “strong sell” rating to a “hold” rating in a research report on Friday, May 15th. Northland Securities downgraded shares of Transcat from an “outperform” rating to a “market perform” rating and set a $95.00 price target for the company. in a report on Wednesday, August 5th. Finally, Weiss Ratings reiterated a “sell (d+)” rating on shares of Transcat in a research report on Tuesday, August 25th. Two equities research analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat, Transcat currently has an average rating of “Reduce” and a consensus price target of $95.00.

Transcat Company Profile

Transcat, Inc (NASDAQ: TRNS) is a leading provider of calibration, laboratory, and metrology services in North America. Founded in 1964 and headquartered in Ronkonkoma, New York, the company specializes in ensuring the accuracy and compliance of measurement instruments across a wide range of industries. Transcat operates a network of ISO/IEC 17025–accredited laboratories and offers on-site field calibration, instrument repair, and preventive maintenance services.

In addition to its calibration services, Transcat distributes precision instrumentation and related software solutions from top manufacturers.