AME – Market expectations are for Uniform ROA to expand to peak levels, but management may be concerned about acquisitions, R&D, and margins

• AMETEK, Inc. (AME:USA) currently trades above historical averages relative to UAFRS-based (Uniform) Earnings, with a 23.4x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about their Tellular and Gatan acquisitions, R&D investments, and EIG margins
• Specifically, management may be exaggerating the progress of their Telular integration, the growth opportunities in Gatan’s markets, and the development of cryo-electron microscopy for new drugs and vaccines. Moreover, they may be concerned about their EIKOS-UV atom probe microscope launch and their investments into R&D. Finally, management may lack confidence in their ability to sustain EIG operating margin improvements, and they may be overstating their focus on operational excellence.