NEOGEN Corporation ( NEOG Quick Quote NEOG - Free Report) , in its efforts to grow via strategic pacts, has partnered with a multi-species animal breeding, genetics, and technology company named Hendrix Genetics. The deal aims to support the implementation of genomic selection in Hendrix's Sustainable Access to Poultry Parent Stock in Africa (SAPPSA) program.
NEOGEN looks forward to being part of this SAPPSA project, which so far has positively impacted the lives of millions of people. This latest mission will help secure the supply of high-quality parent stock to African smallholder farmers.
However, the financial terms of the deal were kept under wraps.
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In 2020, Hendrix Genetics started collecting data on the existing poultry population in Burkina Faso. The elite birds’ offsprings were then tested for growth and egg production characteristics in this tropical climate.
As part of the latest partnership, Hendrix Genetics, with the help of NEOGEN’s Genomics, will be able to genotype the elite animals in the population. With the addition of genotyping, Hendrix Genetics will be able to increase genetic gain in its programs. This is expected to have a positive impact on smallholder farmers who raise these birds, increasing the farmers’ nutritional intake and income.
From NEOGEN’s point of view, this contract will help accelerate the company's existing recurrent test program by genotyping the elite animals across the breeding program. This will help the SASSO breeds to adapt to the local and environmental conditions of Sub-Saharan Africa, including heat, feed, various diseases, and different housing systems.
The company noted that incorporation of genotyping into Hendrix Genetics' advanced breeding program can ensure that the correct birds for the environment are chosen. This will help support the sustainable development of farming practices. It will help in raising awareness about the best practices for nutrition, housing, and poultry biosecurity.
Growth Through Strategic Partnerships
Of late, NEOGEN has inked a series of partnership deals, which are expected to aid in the company’s segmental growth as well as international expansion.
Last week, NEOGEN spoke about its Igenity branded program, which can help in mitigating the risk associated with purchasing calves in the marketplace. Igenity, which was originally launched in 2019, can be used as a marketing tool for cattle producers. This program was launched under the partnership between NEOGEN and Superior Livestock. According to the company, Igenity Branded calves topped livestock sales through the United States in summer.
In June 2021, NEOGEN extended its strategic partnership with Gencove, Inc. The extended collaboration aims to continue the development of robust and innovative animal genomic testing. Through this multi-year global agreement, NEOGEN can offer its SkimSeek low-pass sequencing technology to customers across the agricultural community.
In the same month, the company collaborated with the Center for Aquaculture Technologies (CAT) to provide high-quality genotyping services to aquaculture producers. This partnership will bring together NEOGEN and CAT’s expertise to apply modern sequencing and genotyping technologies to aquaculture species. It is expected to support the aquaculture sector in making more informed breeding decisions.
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In January 2021, NEOGEN acquired Ireland-based Megazyme, Ltd. — a major supplier of analytical solutions used by quality control laboratories in the global food and beverage industries. The acquisition of Megazyme organically expands NEOGEN’s food diagnostics portfolio and at the same time aligns with its aim to provide comprehensive leading solutions to global food producers.
Other notable partnerships of NEOGEN include the one with Transnetyx (in genotyping array) and National FFA (to support the agricultural organization and help fight the spread of COVID-19).
Share Price Performance
Shares of Neogen have underperformed the
industry over the past year. The stock has gained 12% compared with the industry’s increase of 7.8%. Zacks Rank and Key Picks
Currently, NEOGEN carries a Zacks Rank #3 (Hold).
A few better-ranked stocks from the broader medical space are
Envista Holdings Corporation ( NVST Quick Quote NVST - Free Report) , BellRing Brands, Inc. ( BRBR Quick Quote BRBR - Free Report) ,and Biolase, Inc. ( BIOL Quick Quote BIOL - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of Zacks #1 Rank (Strong Buy) stocks here.
Envista Holdings has an estimated long-term earnings growth rate of 27%.
BellRing Brands has an estimated long-term earnings growth rate of 29%.
Biolase has a projected long-term earnings growth rate of 15%.