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Category: Stock Market and Bio-Rad Laboratories
Date: 7 May 2020 Stock Price: $453.80 We take a look at the 1st quarter 2020 earnings report of Bio-Laboratories a company active in developing, manufacturing, and marketing a broad range of innovative products for the life science research and clinical diagnostic markets.
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About Bio-Rad Laboratories
Bio-Rad Laboratories, Inc. (NYSE: BIO and BIOb) is a global leader in developing, manufacturing, and marketing a broad range of innovative products for the life science research and clinical diagnostic markets. With a focus on quality and customer service for over 65 years, our products advance the discovery process and improve healthcare. Our customers are university and research institutions, hospitals, public health and commercial laboratories, biotechnology, pharmaceutical, as well as applied laboratories that include food safety and environmental quality. Founded in 1952, Bio-Rad is based in Hercules, California, and has a global network of operations with more than 8,100 employees worldwide. Bio-Rad had revenues exceeding $2.3 billion in 2019
Overview of Bio-Rad Laboratories 1st quarter 2020 earnings report
The data below refers to the latest quarter unless specified otherwise
- Net sales: $571.664 million (up from $553.979 million for the same quarter of the previous year)
- Net sales increased by 3.2% over the last 12 months
- Cost of sales: $254.276 million (up from $242.217 million for the same quarter of the previous year)
- Cost of sales increased by 4.9% over the last 12 months
- So some margin squeeze for Bio-Rad Laboratories, as their net sales grew at a rate slower than that of their cost of sales
- Net income of Bio-Rad Laboratories: $685.912 million (down from $865.195 million for the same quarter of the previous year)
- Diluted earnings per share: $22.72 (up from $28.74 for the same quarter of the previous year)
- PE ratio of Bio-Rad Laboratories : 7.8
- Diluted number of shares in issue: 30.196 million (up from 30.104 million for the same quarter of the previous year)
- Cash and cash equivalents: $603.551 million
- Cash and equivalents per share: $19.98
- Cash and cash equivalents makes up 4.4% of Bio-Rad Laboratories' market capital
- Cash and cash equivalents makes up 6.95% of Bio-Rad Laboratories' total assets
- Inventories of Bio-Rad Laboratories: $557.029 million
- Inventores makes up 6.4% of Bio-Rad Laboratories' total assets
- Goodwill of Bio-Rad Laboratories: $264.1 million
- Goodwill per share: $8.74
- Goodwill makes up 3% of Bio-Rad Laboratories' total assets
- Stockholders equity in Bio-Rad Laboratories: $6.293 billion
- Stockholders equity per share: $208.40
- So Bio-Rad Laboratories is trading at 2.2 times its stockholders equity which is within the expected range of between 2 and 4 times that most firms tend to trade at.
- For perspective the average price to book value of firms in the S&P 500 is 3.34 times. Read more about the S&P 500 here
- Cash generated from operation: $277.072 million
- Cash generated from operation per share: $2.36
Bio-Rad Laboratories' management commentary on their 1st quarter 2020 earnings
HERCULES, Calif. –Bio-Rad Laboratories, Inc. (NYSE: BIO and BIOb), a global leader of life science research and clinical diagnostic products, today announced financial results for the first quarter ended March 31, 2020.
First-quarter 2020 net sales were $571.6 million, an increase of 3.2 percent compared to $554.0 million reported for the first quarter of 2019. On a currency-neutral basis, quarterly sales increased 4.3 percent compared to the same period in 2019. First-quarter gross margin was 55.5 percent compared to 56.3 percent during the first quarter in 2019.
Life Science segment net sales for the first quarter were $227.2 million, an increase of 5.3 percent compared to the same period in 2019. On a currency-neutral basis, Life Science segment sales increased by 6.0 percent compared to the same quarter in 2019. Currency-neutral sales growth was primarily attributed to sales of Droplet Digital PCR, Gene Expression, Food Science, and Antibody products. On a geographic view, currency-neutral sales increased in Europe and Asia.
Clinical Diagnostics segment net sales for the first quarter were $340.3 million, an increase of 1.9 percent compared to the same period in 2019. On a currency-neutral basis, net sales were up 3.2 percent compared to the same quarter last year. Currency-neutral sales in the first quarter were positively affected by Quality Controls and Blood Typing products. Sales during the first quarter of 2020 increased in the Americas and Europe.
First-quarter 2020 net sales were $571.6 million, an increase of 3.2 percent compared to $554.0 million reported for the first quarter of 2019. On a currency-neutral basis, quarterly sales increased 4.3 percent compared to the same period in 2019. First-quarter gross margin was 55.5 percent compared to 56.3 percent during the first quarter in 2019.
Life Science segment net sales for the first quarter were $227.2 million, an increase of 5.3 percent compared to the same period in 2019. On a currency-neutral basis, Life Science segment sales increased by 6.0 percent compared to the same quarter in 2019. Currency-neutral sales growth was primarily attributed to sales of Droplet Digital PCR, Gene Expression, Food Science, and Antibody products. On a geographic view, currency-neutral sales increased in Europe and Asia.
Clinical Diagnostics segment net sales for the first quarter were $340.3 million, an increase of 1.9 percent compared to the same period in 2019. On a currency-neutral basis, net sales were up 3.2 percent compared to the same quarter last year. Currency-neutral sales in the first quarter were positively affected by Quality Controls and Blood Typing products. Sales during the first quarter of 2020 increased in the Americas and Europe.
"Given the challenges associated with the coronavirus pandemic, we are pleased with overall results of the first quarter," said Norman Schwartz, Bio Rad President and Chief Executive Officer. "While the balance of this year is not as predictable as prior years, Bio-Rad is well-positioned in a number of key areas. Our responsiveness to the current crisis has allowed us to quickly introduce products that are finding value in diagnosing and understanding COVID-19," he said.
2020 Financial Outlook
Given the uncertainties regarding the duration and impact of the COVID-19 pandemic, we are withdrawing our previously issued annual guidance for this year. We believe our second-quarter year-over-year sales may decline by 10 to 15 percent.
2020 Financial Outlook
Given the uncertainties regarding the duration and impact of the COVID-19 pandemic, we are withdrawing our previously issued annual guidance for this year. We believe our second-quarter year-over-year sales may decline by 10 to 15 percent.
Bio-Rad Laboratories (NYSE:BIO) stock price history
The image below obtained from Google, shows Bio-Rad Laboratories stock price for the last 5 years. And it's been a very good time for Bio-Rad Laboratories stockholders. 5 years ago the stock of Bio-Rad Laboratories was trading around $145 a stock and its currently trading at $453.80 That's a strong return of 212.9% provided to Bio-Rad Laboratories stockholders over the last 5 years.
The stock of Bio-Rad Laboratories is trading a lot closer to its 52 week high of $470 than it is to its 52 week low of $281.66. This to us is a clear indication that the short term momentum and sentiment towards Bio-Rad Laboratories stock is positive.
The stock of Bio-Rad Laboratories is trading a lot closer to its 52 week high of $470 than it is to its 52 week low of $281.66. This to us is a clear indication that the short term momentum and sentiment towards Bio-Rad Laboratories stock is positive.
Recent Google search trends for BIO stock price
The graphic below shows the trend in Google searches BIO stock price over the last 12 months in the United States as obtained from Google Trends. The searches for BIO stock price spiked towards the end of March and early April as the stock declined and then recovered sharply.
Recent coverage of Bio-Rad Laboratories
The extract below covers the latest earnings report from Bio-Rad Laboratories as obtained from Nasdaq.com
Bio-Rad Laboratories, Inc. BIO posted first-quarter 2020 adjusted earnings per share (EPS) of $1.91, which surpassed the Zacks Consensus Estimate by 36.4%. Moreover, the bottom line rose 15.8% from the prior-year quarter. The quarter’s adjustments eliminate the impacts of certain non-recurring items like asset amortization costs, legal charges, restructuring benefits and acquisition-related one-time benefits. On a GAAP basis, the company registered earnings of $22.72 per share in the quarter compared with $28.74 a year ago, down 20.9%.
Read the full article here
Bio-Rad Laboratories, Inc. BIO posted first-quarter 2020 adjusted earnings per share (EPS) of $1.91, which surpassed the Zacks Consensus Estimate by 36.4%. Moreover, the bottom line rose 15.8% from the prior-year quarter. The quarter’s adjustments eliminate the impacts of certain non-recurring items like asset amortization costs, legal charges, restructuring benefits and acquisition-related one-time benefits. On a GAAP basis, the company registered earnings of $22.72 per share in the quarter compared with $28.74 a year ago, down 20.9%.
Read the full article here
Bio-Rad Laboratories (NYSE: BIO) stock valuation
So based on Bio-Rad Laboratories 1st quarter 2020 earnings report what do we value Bio-Rad Laboratories stock at? Based on their earnings reported our valuation model provides a target price (full value price) for Bio-Rad Laboratories at $393.20 a stock
We therefore believe that the stock of Bio-Rad Laboratories is overvalued. We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price, which in this case is $393.20. A good entry price into Bio-Rad Laboratories would therefore be at $353.90 or below.
Since the stock of Bio-Rad Laboratories is trading at well above our suggested entry point we rate the stock a sell and expect it to pull back to levels closer to our target price in coming weeks and months
We therefore believe that the stock of Bio-Rad Laboratories is overvalued. We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price, which in this case is $393.20. A good entry price into Bio-Rad Laboratories would therefore be at $353.90 or below.
Since the stock of Bio-Rad Laboratories is trading at well above our suggested entry point we rate the stock a sell and expect it to pull back to levels closer to our target price in coming weeks and months
Next earnings release of Bio-Rad Laboratories
Bio-Rad Laboratories is expected to release their 2nd quarter 2020 earnings report in early August 2020