Embecta (NASDAQ:EMBC) Shares Gap Up on Better-Than-Expected Earnings

Key Points

• Embecta Corp. reported an earnings per share (EPS) of $1.12, significantly beating analysts' estimates of $0.77, leading to a notable increase in stock price from $10.36 to $12.90.
• The company declared a quarterly dividend of $0.15 per share, yielding 5.0% annually, with a payout ratio of 66.67%.
• Institutional investors have shown increased interest, with 93.83% of shares now owned by institutions and hedge funds, reflecting significant buying activity in recent quarters.

Shares of Embecta Corp. (NASDAQ:EMBC - Get Free Report) gapped up prior to trading on Friday after the company announced better than expected quarterly earnings. The stock had previously closed at $10.36, but opened at $12.90. Embecta shares last traded at $12.06, with a volume of 301,357 shares traded.

The company reported $1.12 earnings per share for the quarter, beating the consensus estimate of $0.77 by $0.35. The company had revenue of $295.50 million during the quarter, compared to analysts' expectations of $278.15 million. Embecta had a negative return on equity of 19.67% and a net margin of 4.89%. The firm's quarterly revenue was up 8.4% compared to the same quarter last year. During the same period in the previous year, the business earned $0.74 earnings per share.

Embecta Announces Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Monday, September 15th. Investors of record on Friday, August 29th will be paid a dividend of $0.15 per share. This represents a $0.60 annualized dividend and a yield of 4.9%. Embecta's dividend payout ratio is 66.67%.

Analysts Set New Price Targets

Several equities research analysts recently issued reports on the company. Wall Street Zen raised Embecta from a "hold" rating to a "buy" rating in a research note on Thursday, May 22nd. Mizuho dropped their price objective on Embecta from $13.00 to $12.00 and set a "neutral" rating for the company in a research note on Wednesday, July 16th. Finally, BTIG Research set a $25.00 price target on Embecta and gave the stock a "buy" rating in a research note on Friday, May 23rd.

Insider Transactions at Embecta

In related news, Director David F. Melcher bought 10,000 shares of the stock in a transaction dated Friday, May 23rd. The stock was bought at an average price of $10.60 per share, with a total value of $106,000.00. Following the purchase, the director owned 86,681 shares in the company, valued at approximately $918,818.60. The trade was a 13.04% increase in their position. The acquisition was disclosed in a legal filing with the SEC, which is available at this link. 0.42% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Embecta

A number of hedge funds and other institutional investors have recently modified their holdings of EMBC. Oppenheimer Asset Management Inc. increased its stake in shares of Embecta by 9.0% during the first quarter. Oppenheimer Asset Management Inc. now owns 11,004 shares of the company's stock valued at $140,000 after buying an additional 907 shares during the period. Commonwealth of Pennsylvania Public School Empls Retrmt SYS increased its stake in shares of Embecta by 7.9% during the second quarter. Commonwealth of Pennsylvania Public School Empls Retrmt SYS now owns 15,005 shares of the company's stock valued at $145,000 after buying an additional 1,093 shares during the period. CWM LLC increased its stake in shares of Embecta by 16.0% during the second quarter. CWM LLC now owns 8,080 shares of the company's stock valued at $78,000 after buying an additional 1,115 shares during the period. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. increased its stake in shares of Embecta by 2.4% during the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 49,323 shares of the company's stock valued at $629,000 after buying an additional 1,159 shares during the period. Finally, SummerHaven Investment Management LLC increased its stake in shares of Embecta by 1.9% during the second quarter. SummerHaven Investment Management LLC now owns 66,313 shares of the company's stock valued at $643,000 after buying an additional 1,268 shares during the period. Institutional investors own 93.83% of the company's stock.

Embecta Price Performance

The stock has a market capitalization of $717.64 million, a PE ratio of 8.59, a PEG ratio of 0.79 and a beta of 1.08. The company has a 50 day moving average price of $10.24 and a 200-day moving average price of $12.34.

About Embecta

Embecta Corp., a medical device company, focuses on the provision of various solutions to enhance the health and wellbeing of people living with diabetes. Its products include pen needles, syringes, and safety injection devices, as well as digital applications to assist people with managing patient's diabetes.