Global equity markets rebounded sharply in February, as a number of international indexes traded at multiyear or record highs due to continued accommodative monetary policies and a temporary financial rescue of Greece. US markets were supported by positive corporate earnings and reassurance by the Federal Reserve of maintaining low interest rates. US fourth quarter 2014 GDP growth was downgraded from 2.6% to 2.2% due to lower inventory investments, but underlying economic activity remained positive. For the month, the Dow Jones Industrial Average, S&P 500 and NASDAQ climbed 5.6%, 5.5% and 7.1%, respectively, posting the largest monthly percentage gains in more than two years. Year to date, they are up 1.7%, 2.2% and 4.8%, respectively.

Laboratory Instrumentation Stock Index

The Index advanced 4.1% in February to 231.41 and is up 4.0% for the year. A majority of companies traded higher due to positive market conditions. But while a number of firms reported steady earnings growth, currency took a toll on EPS and revenue guidance.

Agilent Technologies, Bio-Rad Laboratories, Fluidigm and QIAGEN posted double-digit gains for the month due to encouraging earnings results. Fluidigm recorded the largest price increase, climbing 14.7%. On February 5, it reported a narrower-than-expected fourth quarter 2014 adjusted EPS loss, and projected 2015 sales to grow 22%–28% to $142–$149 million, including currency headwinds of 3%–4%.

Agilent, which climbed 11.8% for the month, reported healthy fiscal first quarter organic sales growth on February 17. However, given currency headwinds, it lowered its fiscal 2015 adjusted EPS outlook from $1.68–$1.78 to $1.67–$1.73. Bio-Rad climbed 11.1% for the month, as the company beat fourth quarter 2014 adjusted EPS expectations due to increased sales volume, lower interest expenses and restructuring activity. For 2015, it projected roughly flat sales growth, or 3% growth excluding currency. Finally, QIAGEN advanced 10.2% for the month, as a Chinese study was published in The Lancet supporting the company’s QuantiFERON-TB test over older, less-accurate tuberculin skin tests.

Affymetrix, Becton, Dickinson and Mettler-Toledo also advanced after beating quarterly adjusted EPS expectations. On February 4, Affymetrix reaffirmed its 2015 currency-neutral revenue outlook of mid-single digit growth. Shares grew 6.0% for the month. JPMorgan Chase upgraded the firm on February 5 from “Underweight” to “Neutral” and set a price target of $8 per share. On February 5, Becton raised its fiscal 2015 EPS currency-neutral growth outlook by 1% to 9%–10%. Including currency, fiscal-year EPS are expected to be roughly flat at $6.50–$6.57. Shares climbed 6.3% for the month. Mettler-Toledo projected adjusted first quarter and full-year EPS to grow 7%–9% and 8%–10% to $2.13–$2.18 and $12.70–$12.90, respectively. Shares rose 3.4% for the month.

Despite slightly disappointing results, Bio-Techne and Bruker recorded higher prices for the month, rising 4.8% and 0.9%, respectively. On February 3, Bio-Techne missed fiscal second quarter revenue (see page 12) and adjusted EPS expectations. Bruker beat fourth quarter 2014 adjusted EPS expectations on February 19 but with weaker-than-expected sales growth. It projected 2015 adjusted EPS to be flat at $0.75. On February 10, Bank of America downgraded it from “Buy” to “Neutral” and set a price target of $20 per share.

A number of firms contracted after providing conservative growth outlooks. Pacific Biosciences recorded the largest monthly decline in the Index, slumping 21.6%. On February 4, it forecast a cautious 2015 revenue growth outlook. On February 2, Luminex missed revenue expectations and forecast 2015 sales below analysts’ outlook. Shares slumped 10.8% for the month. NanoString Technologies also provided a conservative 2015 revenue outlook on February 24 due to reimbursement uncertainty for Prosigna. Shares fell 16.1% for the month. FEI was negatively impacted by weaker-than-expected financial results and outlook, as shares fell 3.9% for the month. On February 4, it projected 2015 sales below expectations and estimated GAAP EPS of $3.40–$3.70.

Diversified Instrumentation Stock Index

The Index grew 5.6% for the month to 189.64 and is up 3.1% year to date. All companies traded higher in February, led by AMETEK, which jumped 10.9%. Robert W. Baird upgraded the company on February 13 from “Neutral” to “Outperform” and set a price target of $56 per share. Xylem, which improved 4.7% for the month, beat fourth quarter 2014 adjusted EPS and revenue consensus. For 2015, the company slightly lowered revenue expectations but projected adjusted EPS of $1.85–$1.95, in line with expectations. On February 24, Pall beat adjusted fiscal second quarter EPS projections despite missing revenue consensus due to weakness within the Process Technologies business. The company lowered its fiscal 2015 pro forma EPS outlook by $0.10 to $3.65–$3.85. Shares advanced 4.2% for the month.

International

All major international equity indexes advanced in February. All European indexes increased by more than 6.5%, except the UK’s FTSE 100, which improved 2.9%. Asia Pacific equity markets were also positive, including 6.4% growth for Japan’s Nikkei 225. The Nikkei reach a 15-year high despite weak economic data.

Prices for the Pacific Rim firms in the IBO Stock Table were mostly higher. HORIBA recorded the largest gain, climbing 13.1%. On February 12, it reported that fourth quarter 2014 EPS grew 39% to ¥156.41 ($1.31). Full-year 2014 EPS increased 18% to ¥249.28 ($2.08), and its dividend payout expanded 12% to ¥67 ($0.63) per share. For 2015, sales and operating income are projected to grow 11% and 5%, respectively. On February 27, Techcomp reported that full-year 2014 EPS fell 9% to $0.01. Shares climbed 8.6% for the month. On February 6, Precision System Science increased its revenue outlook by 11% to ¥5.0 billion ($43.5 million) for fiscal 2015. However, it maintained its projected net income loss of ¥350 million ($3.0 million) because of increased development costs. Shares slipped 0.9% for the month. On February 9, Shimadzu reported EPS of ¥13.78 ($0.12) for the fiscal third quarter, compared to a loss of ¥41.71 ($0.40). Ordinary income for the same period grew 5.3%. The company maintained its ordinary-income growth outlook of 0.58% to ¥25.0 million ($0.2 million). Shares rose 4.9% for the month.

Prices for UK-based companies advanced for the month with the exception of Horizon Discovery, which slipped 2.5%. Scientific Digital Imaging recorded the largest gain, rising 11.1%, but remains down 20.0% for the year. On February 27, Spectris reported that adjusted full-year 2014 EPS fell 6% to £1.24 ($1.97). However, shares rose 4.2% for the month. Abcam, which climbed 9.9% for the month, was upgraded by Canaccord Genuity on February 11 from “Sell” to “Hold” with a price target of GBX 432 ($6.58) per share.

Prices for other European companies in the Stock Table also performed well in February. Tecan recorded the highest return, rising 23.1% for the month, while Exiqon fell 8.8%. On February 13, Biotage reported that fourth quarter 2014 EPS slipped 7% to SEK 0.26 ($0.03) due to lower gross margins and higher operating expenses. Shares climbed 7.4% for the month.