TDY Financial Analysis

Analysis Date: 1/24/2025

Business Model

Teledyne generates revenue through four main segments: Digital Imaging, Instrumentation, Aerospace and Defense Electronics, and Engineered Systems

Revenue Sources

• Digital Imaging (54.7% of Q4 2024 revenue)
• Instrumentation (24.6% of Q4 2024 revenue)
• Aerospace and Defense Electronics (13.1% of Q4 2024 revenue)
• Engineered Systems (7.6% of Q4 2024 revenue)

Revenue Distribution by Channel

• Not explicitly disclosed in earnings release

Income Statement Analysis

• Record quarterly sales of $1,502.3M, up 5.4% year-over-year
• Operating margin decreased to 15.8% from 19.1% in Q4 2023
• Net income declined 38.6% primarily due to trademark impairment charges

Balance Sheet Analysis

• Strong balance sheet with $649.8M in cash
• Reduced total debt by $595.9M year-over-year
• Low leverage with consolidated leverage ratio of 1.5x

Cash Flow Analysis

• Record full year operating cash flow of $1,191.9M
• Strong Q4 free cash flow of $303.4M, up 144.3% year-over-year

Capital Allocation

Company deployed $1.1B in 2024 for debt repayments, stock repurchases and acquisitions. Plans to deploy approximately $770M on acquisitions in Q1 2025. Completed acquisition of Micropac Industries and announced pending acquisition of select aerospace and defense electronics businesses from Excelitas Technologies.

Management Commentary

Achieved all-time record sales and non-GAAP earnings per share in Q4

Year-over-year growth accelerated with improvement in shorter-cycle businesses

Strong demand in defense, space, and energy businesses

Remains vigilant given strong U.S. dollar and unpredictable geopolitical environment

Overall Sentiment: Optimistic about performance and business portfolio while maintaining cautious outlook on external factors

Recommendation

Rating: Buy

Reason for Rating: Strong operational execution, successful M&A integration, and robust cash flow generation support positive outlook

Disclaimer: This analysis is based on company filings and public information. It is for informational purposes only and not financial advice. Past performance does not guarantee future results.

Generated on: 1/24/2025, 4:49:37 AM