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Charles River (CRL) to Report Q1 Earnings: What's in Store?
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Charles River Laboratories International, Inc. (CRL - Free Report) is scheduled to report first-quarter 2022 results on May 4, before market open.
In the last reported quarter, the company’s adjusted earnings per share of $2.49 surpassed the Zacks Consensus Estimate by 2.9%. Earnings surpassed estimates in the trailing four quarters, the average beat being 8.17%.
Let’s take a look at how things have shaped up prior to this announcement.
Factors at Play
The Research Models and Services (RMS) segment is likely to have gained from continued global demand for research models and associated services. The company’s ongoing initiatives to boost operating performances by HemaCare and Cellero are anticipated to have had a beneficial impact on the cell supply business.
Over the past few quarters, Charles River has been witnessing significant demand for research model services, especially in China, driven by increased research activities due to the COVID-19 pandemic. However, as the effects of the pandemic subside, we anticipate a gradual slowdown in the considerable surge in research activities during the first quarter.
Meanwhile, the company’s cradle initiative for small and large biopharmaceutical clients is anticipated to have maintained its growth momentum, benefitting the in-sourcing solutions business within the RMS arm.
Charles River Laboratories International, Inc. Price and EPS Surprise
The Discovery and Safety Assessment (DSA) arm is likely to have benefitted from a strong biotechnology client base and robust backlog at the end of 2021.
Within the DSA arm, the Safety Assessment business has been witnessing strong demand and price increases. Per the last-reported fourth-quarter earnings update, the company has hired about twice as many Safety Assessment staff in the second half of 2021 compared to the first half to address the increasing client demand. The company has also been engaged in making additional investments in new spaces to meet the growing demand. We expect these developments to have contributed to significant growth in the Safety Assessment business in the to-be-reported quarter. Further, bookings and proposal volume growth is likely to have maintained momentum in the first quarter, driving the top line.
The Discovery business is likely to have gained from continued strong performances by early discovery and CNS services. Of late, Charles River has been witnessing growing client interest in integrated drug discovery programs. To meet the robust client demand for Discovery Services, the company has been closely managing staffing levels and introducing new cutting-edge capabilities. The company has also been consistently expanding its discovery portfolio through strategic partnerships and acquisitions. Recently, Charles River entered into collaborations with Valo Health and SAMDI Tech to expedite the drug discovery process. We expect these ongoing business trends and initiatives to have fuelled growth during the first quarter.
The Manufacturing Support segment is likely to have been driven by revenue growth across the Microbial Solutions and Biologics Testing Solutions businesses. The company has been recording strong demand across its portfolio of critical quality control testing solutions within the Microbial Solutions business. Meanwhile, we anticipate the continued uptake of cell and gene therapy testing services for the Biologics Testing Solutions business to drive revenues in the to-be-reported quarter.
The CDMO business, within the Manufacturing Support segment, is likely to gain from growing customer interest in the comprehensive cell and gene therapy portfolio. The CDMO acquisitions of Cognate and Vigene Biosciences are also likely to contribute to the first-quarter sales performance. Charles River continues to make necessary investments and build capacity to meet the growing demand for CDMO services while expanding its extensive portfolio of manufacturing services.
Q1 Estimates
The Zacks Consensus Estimate for the company’s first-quarter 2022 revenues is pegged at $908.13 million, suggesting a 10.1% rise over the year-ago reported figure.
The Zacks Consensus Estimate for the company’s first-quarter 2022 earnings per share of $2.71 indicates a 7.1% uptick from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has higher chances of beating estimates. However, this is not the case here, as you can see:
Earnings ESP: The company has an Earnings ESP of -0.21%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are a few stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle.
Computer Programs and Systems has an Earnings ESP of +1.52% and a Zacks Rank of #1. Computer Programs and Systems will release first-quarter 2022 results on May 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Computer Programs and Systems’ long-term earnings growth rate is estimated at 14%. CPSI’s earnings yield of 8.52% compares favorably with the industry’s (7.58%).
Alcon Inc. (ALC - Free Report) has an Earnings ESP of +10.04% and a Zacks Rank of #2. Alcon is expected to release first-quarter 2022 results on May 3.
Alcon’s long-term earnings growth rate is estimated at 14.7%. ALC’s earnings yield of 3.22% compares with the industry’s (6.88%).
Meridian Bioscience, Inc. has an Earnings ESP of +26.32% and a Zacks Rank of #2. Meridian Bioscience is scheduled to release second-quarter fiscal 2022 results on May 6.
Meridian Bioscience’s long-term historical earnings growth rate is 16.3%. VIVO’s earnings yield of 5.52% compares favorably with the industry’s 0.92%.
Image: Bigstock
Charles River (CRL) to Report Q1 Earnings: What's in Store?
Charles River Laboratories International, Inc. (CRL - Free Report) is scheduled to report first-quarter 2022 results on May 4, before market open.
In the last reported quarter, the company’s adjusted earnings per share of $2.49 surpassed the Zacks Consensus Estimate by 2.9%. Earnings surpassed estimates in the trailing four quarters, the average beat being 8.17%.
Let’s take a look at how things have shaped up prior to this announcement.
Factors at Play
The Research Models and Services (RMS) segment is likely to have gained from continued global demand for research models and associated services. The company’s ongoing initiatives to boost operating performances by HemaCare and Cellero are anticipated to have had a beneficial impact on the cell supply business.
Over the past few quarters, Charles River has been witnessing significant demand for research model services, especially in China, driven by increased research activities due to the COVID-19 pandemic. However, as the effects of the pandemic subside, we anticipate a gradual slowdown in the considerable surge in research activities during the first quarter.
Meanwhile, the company’s cradle initiative for small and large biopharmaceutical clients is anticipated to have maintained its growth momentum, benefitting the in-sourcing solutions business within the RMS arm.
Charles River Laboratories International, Inc. Price and EPS Surprise
Charles River Laboratories International, Inc. price-eps-surprise | Charles River Laboratories International, Inc. Quote
The Discovery and Safety Assessment (DSA) arm is likely to have benefitted from a strong biotechnology client base and robust backlog at the end of 2021.
Within the DSA arm, the Safety Assessment business has been witnessing strong demand and price increases. Per the last-reported fourth-quarter earnings update, the company has hired about twice as many Safety Assessment staff in the second half of 2021 compared to the first half to address the increasing client demand. The company has also been engaged in making additional investments in new spaces to meet the growing demand. We expect these developments to have contributed to significant growth in the Safety Assessment business in the to-be-reported quarter. Further, bookings and proposal volume growth is likely to have maintained momentum in the first quarter, driving the top line.
The Discovery business is likely to have gained from continued strong performances by early discovery and CNS services. Of late, Charles River has been witnessing growing client interest in integrated drug discovery programs. To meet the robust client demand for Discovery Services, the company has been closely managing staffing levels and introducing new cutting-edge capabilities. The company has also been consistently expanding its discovery portfolio through strategic partnerships and acquisitions. Recently, Charles River entered into collaborations with Valo Health and SAMDI Tech to expedite the drug discovery process. We expect these ongoing business trends and initiatives to have fuelled growth during the first quarter.
The Manufacturing Support segment is likely to have been driven by revenue growth across the Microbial Solutions and Biologics Testing Solutions businesses. The company has been recording strong demand across its portfolio of critical quality control testing solutions within the Microbial Solutions business. Meanwhile, we anticipate the continued uptake of cell and gene therapy testing services for the Biologics Testing Solutions business to drive revenues in the to-be-reported quarter.
The CDMO business, within the Manufacturing Support segment, is likely to gain from growing customer interest in the comprehensive cell and gene therapy portfolio. The CDMO acquisitions of Cognate and Vigene Biosciences are also likely to contribute to the first-quarter sales performance. Charles River continues to make necessary investments and build capacity to meet the growing demand for CDMO services while expanding its extensive portfolio of manufacturing services.
Q1 Estimates
The Zacks Consensus Estimate for the company’s first-quarter 2022 revenues is pegged at $908.13 million, suggesting a 10.1% rise over the year-ago reported figure.
The Zacks Consensus Estimate for the company’s first-quarter 2022 earnings per share of $2.71 indicates a 7.1% uptick from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has higher chances of beating estimates. However, this is not the case here, as you can see:
Earnings ESP: The company has an Earnings ESP of -0.21%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are a few stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle.
Computer Programs and Systems has an Earnings ESP of +1.52% and a Zacks Rank of #1. Computer Programs and Systems will release first-quarter 2022 results on May 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Computer Programs and Systems’ long-term earnings growth rate is estimated at 14%. CPSI’s earnings yield of 8.52% compares favorably with the industry’s (7.58%).
Alcon Inc. (ALC - Free Report) has an Earnings ESP of +10.04% and a Zacks Rank of #2. Alcon is expected to release first-quarter 2022 results on May 3.
Alcon’s long-term earnings growth rate is estimated at 14.7%. ALC’s earnings yield of 3.22% compares with the industry’s (6.88%).
Meridian Bioscience, Inc. has an Earnings ESP of +26.32% and a Zacks Rank of #2. Meridian Bioscience is scheduled to release second-quarter fiscal 2022 results on May 6.
Meridian Bioscience’s long-term historical earnings growth rate is 16.3%. VIVO’s earnings yield of 5.52% compares favorably with the industry’s 0.92%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.