Mettler-Toledo Earnings: Underlying Growth Drivers Intact Despite Weakening Near-Term Demand

Second-quarter results for narrow-moat Mettler-Toledo landed roughly as expected, but slowing order volume from biopharmaceutical clients in China caused management to reduce its 2023 guidance somewhat. While we have made minor reductions to our full-year assumptions based on these trends, those adjustments were largely offset by cash flows generated since our last valuation update, and we are maintaining our $880 fair value estimate. The shares still look overvalued despite falling in after-hours trading.