Agilent Technologies (A) Valuation Check After FDA Expansion Of Keytruda Companion Diagnostic

Agilent Technologies (A) just secured U.S. FDA approval for its PD-L1 IHC 22C3 pharmDx test in first line ovarian and related cancers, extending the assay’s use as a companion diagnostic for Merck’s Keytruda.

See our latest analysis for Agilent Technologies.

Agilent’s latest FDA approval and ongoing automation push come while the 1 month share price return of 9.9% decline and 3 year total shareholder return of 13.24% decline signal pressure on both short and long term performance, suggesting sentiment is still resetting rather than building momentum.

If this oncology focused news has you thinking about where else AI is reshaping labs and diagnostics, take a look at our curated set of 25 healthcare AI stocks as a starting point for further ideas.

With Agilent shares down over the past year even as revenue and net income growth remain positive, is the recent FDA win and AI automation push an overlooked entry point, or is the market already pricing in future growth?

Most Popular Narrative: 25.8% Undervalued

Agilent Technologies closed at $125.81, while the most followed narrative anchors fair value at $169.67, framing the latest FDA win within a wider, long term thesis.

Strategic investments in higher margin recurring revenue streams including consumables, software, services, and digital platforms are gaining traction, with CrossLab and services delivering consistent mid single digit growth and high customer satisfaction, indicating further margin expansion and greater earnings stability in future periods.

Read the complete narrative.

Curious what supports a higher fair value when recent returns are under pressure? The narrative focuses on recurring revenue, margin expansion, and a richer earnings profile projected a few years out.

Result: Fair Value of $169.67 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this hinges on tariff costs and supply chain reshuffling not biting harder than expected, and it also depends on lab customers not stretching out replacement cycles longer than analysts assume.

Find out about the key risks to this Agilent Technologies narrative.

Another View: P/E And Fair Ratio Send A Different Signal

Analysts see upside from today’s $125.81 price, yet Agilent trades on a 27.3x P/E versus a fair ratio of 24.4x, the US Life Sciences industry at 35.2x and peers at 30.8x. The stock therefore appears cheaper than its sector but richer than its own fair ratio, raising the question of whether you see more valuation risk or opportunity here.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Agilent Technologies Narrative

If you see the numbers differently or want to stress test these assumptions yourself, you can create your own full thesis in minutes: Do it your way.

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Agilent Technologies.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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