A month has gone by since the last earnings report for Veralto (VLTO). Shares have lost about 5.6% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Veralto due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Veralto Corporation before we dive into how investors and analysts have reacted as of late.
VLTO Beats Q1 Earnings Estimates
Veralto reported impressive first-quarter 2026 results, with both earnings and revenues beating the Zacks Consensus Estimate.
VLTO’s adjusted earnings per share (EPS) of $1.07 beat the consensus mark of $1.02 and rose 12.6% year over year. Total revenues came in at $1.42 billion, surpassing the consensus estimate of $1.40 billion and increasing 6.8% from the year-ago quarter.
Quarterly Details of Veralto
Revenues from the Water Quality segment were $874 billion, increasing 10.1% from the year-ago reported figure. Product Quality and Innovation revenues in the first quarter of 2026 grew 1.7% to $548 million.
Operating profit was $338 million, increasing 5% on a year-over-year basis. The adjusted operating profit margin was 25.1%, up 10 basis points from the year-ago reported figure.
Balance Sheet & Cash Flow Figures
Veralto exited the first quarter of 2026 with cash and cash equivalents of $1.43 billion compared with $1.23 billion in the first quarter of 2025. Net debt was $1.2 billion compared with $1.3 billion in the year-ago quarter.
VLTO generated $182 million in cash from operating activities in the quarter. Capital expenditure was $12 million. Free cash flow was $170 million.
VLTO’s Q2 & 2026 Outlook
For second-quarter 2026, management expects core sales growth of 3%-4% year over year. Adjusted EPS is expected to be between 96 cents and $1.00.
For 2026, the company projects core sales growth to be in the range of 3.0% to 4.5%. Adjusted EPS is expected to be between $4.20 and $4.28.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Veralto has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Veralto has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Veralto Corporation (VLTO): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).