Diploma (LON:DPLM) Posts Quarterly Earnings Results

Diploma (LON:DPLM) posted its earnings results on Tuesday. The company reported GBX 74.70 EPS for the quarter, Digital Look Earnings reports. Diploma had a return on equity of 18.55% and a net margin of 9.42%.The company had revenue of £851.10 million for the quarter.

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

• H1 results were very strong, with organic growth of 15%, total revenue up 17%, operating margin expanding 300 bps to 24.5%, and EPS rising 36%. Return on capital also improved to 22.7%, underscoring continued compounding performance.
• The company raised full-year guidance again, now expecting 12% organic growth and 6% contribution from acquisitions, up from 9% and 3% previously. Management said it still expects operating margin to hold at 25% for the year.
• Controls was the standout division, delivering 26% organic growth, led by strong performances from Clarendon, IS-Group, Windy City Wire, and Peerless. Management said growth is broad-based and should remain strong, even if comparisons get tougher in H2.
• Acquisition activity accelerated, with 15 deals completed over the last 12 months and GBP 310 million deployed in total. Management emphasized that deal flow remains strong, but some acquisitions may be slightly dilutive to group margins in the near term.
• Seals and Life Sciences remain mixed: North American Seals performed well, while International Seals showed improvement late in Q2 but remains challenged; Life Sciences posted 4% organic growth and management expects broadly mid-single-digit growth for the full year.

Diploma Trading Down 1.1%

Shares of DPLM stock opened at GBX 6,795 on Thursday. The company has a current ratio of 2.06, a quick ratio of 0.80 and a debt-to-equity ratio of 47.65. The stock has a market cap of £9.11 billion, a P/E ratio of 49.49, a price-to-earnings-growth ratio of 2.82 and a beta of 0.92. The stock has a 50 day simple moving average of GBX 6,369.17 and a 200 day simple moving average of GBX 5,767.02. Diploma has a 1 year low of GBX 4,558 and a 1 year high of GBX 7,295.

Insider Activity

In other Diploma news, insider Ian El-Mokadem bought 500 shares of the business’s stock in a transaction on Friday, March 20th. The stock was purchased at an average cost of GBX 5,820 per share, for a total transaction of £29,100. Company insiders own 1.14% of the company’s stock.

Wall Street Analysts Forecast Growth

Several equities research analysts recently issued reports on the company. Deutsche Bank Aktiengesellschaft boosted their price target on Diploma from GBX 6,400 to GBX 7,200 and gave the company a “buy” rating in a research note on Wednesday. Stifel Nicolaus boosted their price target on Diploma from GBX 6,200 to GBX 6,800 and gave the company a “buy” rating in a research note on Thursday, March 19th. JPMorgan Chase & Co. boosted their price target on Diploma from GBX 5,120 to GBX 5,760 and gave the company a “neutral” rating in a research note on Friday, March 27th. Royal Bank Of Canada boosted their price target on Diploma from GBX 6,600 to GBX 7,300 and gave the company an “outperform” rating in a research note on Wednesday. Finally, Jefferies Financial Group reiterated a “hold” rating and issued a GBX 5,700 price target on shares of Diploma in a research note on Wednesday. Five investment analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company. Based on data from MarketBeat.com, Diploma currently has an average rating of “Moderate Buy” and an average price target of GBX 6,626.25.

Diploma Company Profile

Diploma PLC, together with its subsidiaries, supplies specialized technical products and services in the United Kingdom, Continental Europe, North America, and internationally. It operates through three business sectors: Life Sciences, Seals, and Controls. The Life Sciences sector supplies technology-enabled products used in surgical procedures in operating theatres and endoscopy; testing equipment and services for clinical laboratories; and bio-pharma, food safety and testing, and other research-oriented products.